California city pioneers sale of accessory dwelling units as independent properties

San Jose has pioneered a new housing model in California by completing the first independent sale of an accessory dwelling unit (ADU). This landmark transaction was made possible by a law signed by Governor Gavin Newsom in 2023, which permits ADUs to be sold separately from the main residence.

The sale, a two-bedroom house near downtown San Jose, closed at $530,000. The property features its own entrance, private parking, and independent utilities, distinguishing it from traditional condominiums as it does not have homeowner association fees. Daniel Aflakian, the buyer, highlighted the opportunity this presents for individuals seeking more accessible homeownership compared to conventional single-family homes.

This development stems from the Assembly Bill 1033, signed by Newsom on October 11, 2023. The legislation amends state government codes to allow cities and local governments to enact ordinances permitting the separate sale of ADUs as condominiums. Previously, ADUs generally could not be sold independently, with limited exceptions for specific non-profit projects.

The new law grants cities the discretion to implement such ordinances, potentially transforming how accessory dwelling units are developed and marketed across California. This move is seen as a significant step towards increasing housing options and affordability in the state.