Coming back to live in parents' homes in is getting a facelift with more buyers turning to second homes placed in the backyard as an option for affordable living spaces. Changes in zoning laws regarding second homes are making it easier to provide privacy and additional space for homeowners’ grown children or aging parents. Enterprising homeowners can also use second homes for extra cash by renting out the spaces.
Growth in the sector has been fueled by changes to local and state zoning rules. Some municipalities are struggling with a lack of affordable housing and see these additional units as one remedy.
In 2010 Portland, Oregon, waived impact fees for ADUs, making them significantly less expensive. As a result, the number of ADU permits jumped from 86 in 2010 to 660 in 2018, according to a count by accessorydwellings.org.
In California, when a 2017 state law forced cities to relax ADU regulations, permits jumped even more dramatically.
And that all translates into big growth for ADU builders, like Prefab ADU, based in the California Bay Area. It built and installed about 100 ADUs this year but expects to expand that to at least 1,500 next year.