All Forum Posts by: John Arendsen

We''ve been extremely busy installing ADU's throughout San Diego County and the landscape is changing by the day. If you're in California I would recommend boning up on the latest HCD ADU laws and regs (https://www.hcd.ca.gov/policy-...). I'd also get up to date on all the recent FDMC/FNMA FHA laws, https://www.americanbanker.com... for manufactured housing which also applies to ADUs. https://sf.freddiemac.com/faqs... and https://appraisersblogs.com/fa...

A lot has changed in ADU land since the premier January, 2017 rollout of SB-1069 https://www.hcd.ca.gov/policy-... and it's a challenge trying to jump through all the hoops. The State is constantly updating and amending their law/s causing jurisdictions to change their ordinances about as often as we change our bed linens. With all these hoops to jump through it's even difficult for contractors, purveyors, architects and myriad stakeholders to follow the bouncing ball let alone pull permits in a timely manner.

Add to that the challenge of educating appraisers and you've got a hat trick that is keeping the entire ADU industry on its toes 24/7/365. For the turn and burn investor trying to throw up an ADU and sell to make a fast few it's not quite time. There just aren't that many ADU properties that have sold let alone even on the market yet. So good appraisals are a challenge until there's more ADU sales on the market. Now for the buy and hold type the ball is in your court. If you were prudent in building/installing your backyard home or you purchased a property with one already built out, time is on your side.

All is not bad, however, At the end of the day we find that about 50% of our clients are adding them to their property for a family member, home health care provider, domestic employee, etc. The other 50% are investors seeking additional revenue streams and ROI. Bottom line this once "cottage industry" is fast becoming a "major growth industry" very similar to the remodeling and fix and flip trends we saw in the post '08 meltdown. All in all there is very little downside risk compared to the long term upside potential depending on your investment criteria. Hope you find this useful. 

Just circling back. I've been extremely busy installing ADU's throughout San Diego County and a lot has changed. If you're in California I would recommend boning up on the latest HCD ADU laws and regs (https://www.hcd.ca.gov/policy-...). I'd also get up to date on all the recent FDMC/FNMA FHA laws, https://www.americanbanker.com... for manufactured housing which also applies to ADUs. https://sf.freddiemac.com/faqs... and https://appraisersblogs.com/fa...

A lot has changed in ADU land since the premier 2017 rollout of SB1079 and it's a challenge trying to jump through all the hoops. The State is constantly updating and amending their law/s causing jurisdictions to change their ordinances about as often as we change our bed linens. With all these hoops to jump through it's even difficult for contractors, purveyors, architects and myriad stakeholders to follow the bouncing ball.

Add to that the challenge of appraisals and you've got a hat trick that is keeping the entire ADU industry on its toes 24/7/365. For the turn and burn investor trying to throw up an ADU and sell to make a fast few it's not quite time. There just aren't that many ADU properties that have sold let alone even on the market yet. Now for the buy and hold type the ball is in your court. If you were prudent in building/installing your backyard home or you purchased a property with one already built out, time is on your side.

All is not bad, however, At the end of the day we find that about 50% of our clients are adding them to their property for a relative, home health care provider, domestic employee, etc. The other 50% are investors seeking additional revenue streams and ROI. Bottom line the backyard home biz is here to stay and at the end of the day you won't be sorry you have one IMO.

I'm a bit late to this party but it appears you've received some good info. I've been active in the ADU biz for 40 years as a purveyor and an investor. If you're in the right area the upside potential is far greater than the downside risk But bottom line do your due diligence and work with a purveyor that knows what they're doing. If you haven't already seen this it may help clear up som foggy areas. https://www.hcd.ca.gov/policy-...Good Luck. 

Cheers,

John DL Arendsen

I'm a bit late to this party but it appears you've received some good info. I've been active in the ADU biz for 40 years as a purveyor and an investor. If you're in the right area the upside potential is far greater than the downside risk But bottom line do your due diligence and work with a purveyor that knows what they're doing. If you haven't already seen this it may help clear up som foggy areas. https://www.hcd.ca.gov/policy-...Good Luck. 

Cheers,

John DL Arendsen

A little late to this party but if you're ever interested in San Diego let me know. Been at the ADU game for 40 years and happy to help in anyway.

Cheers,

John DL Arendsen

Looks like I'm a little late to the party on this one. I've been away from BP for quite awhile, however, I've been heavily involved with the ADU biz for most 40 years as a purveyor and an investor. The advice you've received thus far is spot on. However, I'll add another aspect to this dialogue that may cast a different perspective. I would first refer to the ADU mandates https://www.hcd.ca.gov/policy-. There are restrictions and stipulations in certain Cali jurisdictions that restrict if not prohibit STR's Know this before you make an investment based solely on STR's. The ADU Mandate was introduced primarily as an affordable housing solution. STR's definitely don't fit that criteria. Hope by now you've received all this info. If you have anymore questions please feel free to contact me anytime.

Cheers,

John DL Arendsen
 

Hi Brack,

Looks like I'm a little late to this party. Hope by now you've found some answers. We've been heavily involved in the manufactured home ADU biz for almost 4 decades as both a purveyor and investor. If you're still looking for some answers please feel free to reach out to me anytime. We're in San Diego but have done quite a number of projects and investments in South Riverside.

Cheers,

John DL Arendsen

760 815-6977 

I just ran across this. How did your project turn out? I'm in the ADU biz in San Diego and have been looking on BP for folks who are involved with this industry.

The laws have been in place for more than a year, and this year the professionals will help you plan, design, finance and build your ADU. You'll see:

• Real-world designs and practical challenges
• Options for pre-fab, modular, manufactured and stick-built ADUs
• Efficient approaches and permit pitfalls
• Templated strategies for financing, maximizing ROI and eliminating cash costs
• The process from A-Z
• Upcoming improvements in ADU laws & regulations
• A virtual fair of curated ADU experts who you can talk to and ask questions

The most important thing I've found personally after 4 decades of investing, developing and redeveloping in MH Park/communities is to stay focused on communities that are in the path of progress regardless of the age of the park. 

It's not about how little you invest. More importantly it's about where you invest. We focus on coastal, lake, river, resort, country club areas where the demographics are conducive to support investment. 

There are literally thousands of MH communities scattered across the entire Country that are derelicts or in some cases toilets run by slum lords who are only  interested in collecting rent and could care less about the condition of the communities. Learn where these are and avoid them like the plague IMO.