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  • Writer's pictureMaxwell Shenk

AB 1033 - Can I Sell An ADU?



Everyone in San Diego knows that purchasing properties with the potential for adding additional dwelling units can drastically improve your investment's value. Investors use ADU’s to increase NOI, especially as they can be cheaper than purchasing an already built unit, and homeowners can use the additional income to offset their mortgage. Now what if you could purchase a property and immediately offset the cost by selling the ADU separately? That’s AB 1033.


The bill aims to allow the separate conveyance of the primary dwelling unit and accessory dwelling unit in order to offset homeowner costs and create more independent (and affordable) homes in cities falling behind on housing demand. This idea has been pitched as “gentle density” with the idea of keeping neighborhoods from becoming inundated with apartment complexes but instead with more single family style homes. The Seattle Times has a great article on how this process is being used and how it is affecting housing prices. One key note is that unfortunately when you live in an expensive or sought after area it will most likely never be “cheap” to buy a home, but it can mitigate the cost slightly. As per the article, Seattle’s median home price is $1.2 million but the ADU’s are selling at $732,000. No one (except those living in high demand cities) would consider this “cheap” but prospective homeowners can agree that housing $470k under median pricing is a great deal.


On September 11 2023 AB 1033 went to engrossing and enrolling which means it will next be prepared into legislation. Once prepared, and signed by presiding officers of both houses it will be presented to the Governor. We will be keeping our eye out for more on this bill but it could be a massive step forward to those already taking advantage of the booming ADU approvals.


Our blogs are provided on selected topics and should not be relied upon as a complete report of all new changes of local, state, and federal laws affecting property owners and managers. Laws may have changed since this article was published or may have been misinterpreted. Before acting, be sure to receive legal advice or consult a licensed CPA.


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