Things to Know About Building an ADU in San Francisco

As urban spaces become more crowded and housing prices soar, Accessory Dwelling Units (ADUs) have surged in popularity across cities, and San Francisco is no exception. These small, versatile living spaces, built on the same property as existing homes, offer a smart solution to the city’s ongoing housing crisis. Whether you’re looking to generate rental income, provide living space for family members, or increase your property value, building an ADU is a strategic way to maximize your space.

However, before breaking ground on your ADU project, there are several crucial factors to consider. From navigating San Francisco’s unique permitting process to understanding the costs and design guidelines, proper planning is key.

This blog will guide you through the most important aspects of building an ADU in San Francisco.

An Accessory Dwelling Unit (ADU) is a small, self-contained residential unit located on the same lot as a single-family home. Often referred to as “granny flats” or “in-law units,” ADUs provide additional living space without requiring the purchase of new land, making them an attractive option for homeowners looking to expand their property’s functionality.

ADUs come in a variety of forms, each with its own unique advantages:

• Detached ADU: A stand-alone structure separate from the primary home, often located in the backyard.

• Attached ADU: Built as an addition to the existing home, sharing one or more walls with the primary residence.

• Garage Conversion: An increasingly popular option, this involves transforming an existing garage into a livable unit.

Building an ADU offers a wide range of benefits for homeowners, making it a smart investment in many ways. One of the most appealing advantages is the potential for rental income. By transforming unused space into a functional living area, homeowners can generate passive income by renting out the ADU, whether for long-term tenants or as a short-term rental.

In addition to financial benefits, ADUs provide valuable extra living space. Whether you’re looking to accommodate family members, welcome guests, or create a home office, an ADU offers flexibility and comfort.

Many homeowners also appreciate how an ADU can boost the overall value of their property. Adding this versatile space can significantly increase your home’s market appeal and long-term investment potential.

While San Francisco encourages ADU development as part of its efforts to address housing shortages, there are detailed policies that govern where and how ADUs can be constructed. It’s important to be aware of these guidelines, which include specific zoning regulations, limits on the size and height of ADUs, and requirements for setbacks and parking. Homeowners must also comply with local building codes, which cover fire safety, seismic retrofitting, and neighborhood design standards​.

Being well-informed about these rules helps ensure a smoother, compliant ADU construction process.

City Policies and Zoning Rules

In San Francisco, ADUs are permitted on both single-family and multifamily lots, but the number and type of ADUs allowed depend on the zoning district and the size of the property.

Check the city’s regulations here to find out if an ADU is permitted on your property type.

Rent Control and Tenant Protection Laws

San Francisco has stringent rent control and tenant protection laws designed to preserve tenant rights, and these regulations extend to ADUs as well. If you decide to rent out your ADU, it’s crucial to understand your responsibilities as a landlord, especially if your property falls under rent control. Under local laws, many newly constructed ADUs, especially those added to existing buildings, may be subject to rent control through the Costa-Hawkins Act or local regulations​.

Homeowners renting out ADUs must also adhere to regulations regarding lease agreements, eviction procedures, and tenant protections. For instance, tenants in rent-controlled units have protections against excessive rent increases and unjust evictions. Landlords must follow strict rules about what constitutes “just cause” for evictions, such as non-payment of rent or violation of the lease terms. Failing to comply with these laws can result in penalties, including financial restitution to tenants.

Eligibility Criteria

Several key factors determine if your property qualifies for an ADU. First, your property must meet minimum requirements for lot size, and the ADU’s design must comply with height and setback regulations.

For example, detached ADUs are often restricted in height to ensure neighborhood compatibility. Additionally, no additional parking is generally required for ADUs, especially if the property is within a half-mile of public transit​. San Francisco also has specific guidelines regarding seismic retrofitting and fire safety standards that ADUs must meet.

By working with experts like Green Group Remodeling, homeowners can navigate these complex regulations and ensure their ADU project complies with all local requirements, helping them make the most of their space while contributing to the city’s housing solutions.

Building an ADU in San Francisco involves a structured permitting process that can take over 18 months, depending on the complexity of the project. Here’s an overview of the steps you’ll need to follow, from initial planning to breaking ground.

Step-by-Step Permit Process

Preparation (Time: 2+ months)
Before starting your ADU project, you need to check San Francisco’s local rules and determine if your property qualifies for an ADU. This stage includes hiring professionals like architects or engineers to design your ADU and confirming if any tenant-related regulations apply.

Submit Your Application
Once your plans are ready, submit your application online to the San Francisco Planning Department. You may need additional forms depending on whether your project includes seismic work, variances, or multiple ADUs.

Initial Review (Time: 2 weeks)
The Planning Department will conduct an initial review of your application. At this point, you may be asked to provide additional documentation or correct any issues with your submission.

Comprehensive Plan Review (Time: 1-3 months)
Your plans will be reviewed by multiple city agencies, including SF Planning, SF Fire, the Department of Building Inspection, Public Works, and SF Public Utilities Commission. Each department ensures your ADU meets the required safety and building standards.

Permit Issuance (Time: 2 weeks)
Once all city agencies have approved your plans, your final permit will be issued. You’ll receive instructions on paying the final fees and any further steps before construction.

Start Construction
With your permits in hand, you can begin construction. If you submitted a site permit initially, you will need to submit an addendum before starting construction.

Timeline

On average, the ADU permitting process in San Francisco can take 18 months or more, from planning to approval. Larger projects, or those with complex compliance requirements, may extend this timeline.

Fees

The total cost of building an ADU typically ranges from $125,000 to $200,000. Professional services like architects and engineers typically cost around 10% of the construction budget, while city fees account for 6-9% of the overall cost.

With the expertise of Green Group Remodeling, you can streamline this process, ensuring that all requirements are met efficiently and avoiding unnecessary delays.

Building an ADU in San Francisco can be rewarding, but it also comes with its share of challenges. Understanding and preparing for these potential roadblocks can help you avoid delays and ensure a smoother construction process. Several common challenges can arise when building an ADU in San Francisco:

• Neighborhood Opposition: ADUs sometimes face pushback from neighbors concerned about increased density, parking shortages, or changes to the neighborhood’s character. Community involvement and transparency about the project can help mitigate opposition.

• Complex Regulations: San Francisco’s ADU regulations are detailed and involve multiple city departments, including planning, fire safety, and public works. Navigating the permitting process and ensuring compliance with all local ordinances can be daunting.

• Limited Space: In densely populated areas, space constraints may limit ADU size or require creative solutions, particularly when it comes to setbacks, privacy, and access to natural light.

Tips for Success

To overcome these challenges and avoid unnecessary delays:

• Early Research: Thoroughly review San Francisco’s ADU regulations before starting your project. Understanding zoning requirements, setbacks, and design guidelines can prevent costly revisions later on.

• Clear Communication: Engage with neighbors early in the planning process to address concerns and gain community support for your project. Public meetings or private discussions can often help smooth over potential conflicts.

• Efficient Planning: Minimize delays by ensuring all required documents, plans, and approvals are in order before submission. Make use of the city’s online resources to track the status of your permits and prepare for any additional requests from city officials.

Hiring Professionals

Given the complexity of building an ADU in San Francisco, working with experienced professionals is crucial to the success of your project. Hiring architects, contractors, and legal consultants who specialize in ADU construction and are familiar with local regulations can help you navigate the permitting process, ensure compliance, and avoid costly mistakes. Green Group Remodeling can provide the expertise and guidance you need, ensuring a streamlined process from start to finish.

Long-Term Considerations

Building an ADU is just the beginning; maintaining it and understanding the financial and legal implications are key to ensuring it remains a valuable asset over time.

ADU Maintenance

Once your ADU is complete, regular upkeep will be necessary to preserve its condition and value. Like any other part of your property, ADUs require periodic inspections and maintenance to address potential issues such as plumbing, roofing, and electrical systems. Regular cleaning and addressing small repairs quickly will help prevent larger, more costly problems down the road. If you’re renting out the ADU, setting aside a portion of rental income for maintenance costs is a good practice to ensure it remains in top condition.

Renting Out Your ADU

When renting out your ADU, it’s important to familiarize yourself with San Francisco’s strict tenant protection and rent control laws. Rental agreements must comply with local regulations, and tenants have protections under laws that govern eviction and rent increases. San Francisco’s rent control laws may apply to your ADU, particularly if it is part of a pre-existing building. Additionally, landlords must adhere to legal processes for lease agreements and any potential evictions, ensuring that tenant rights are respected to avoid legal issues.

Tax Implications

Adding an ADU to your property can have significant tax implications. First, your property taxes are likely to increase based on the added value of the ADU. However, San Francisco assesses ADUs separately from the main house, which can help limit the overall tax burden. Furthermore, if you decide to sell your property in the future, an ADU may impact capital gains taxes, as it is considered part of the overall property value. Consulting with a tax professional is highly recommended to understand how the ADU will affect both your property taxes and potential capital gains when selling. By staying on top of maintenance, understanding tenant rights, and preparing for tax changes, you can maximize the long-term benefits of your ADU.

Building an ADU in San Francisco offers an exciting opportunity to expand your property’s functionality and value, but it also requires careful attention to regulations, design, and financing.

Throughout this blog, we’ve explored key factors such as understanding San Francisco’s complex permitting process, complying with local laws, managing costs, and planning for long-term maintenance and rental considerations. With the right preparation, you can overcome challenges like limited space or neighborhood opposition and create a space that suits your needs.

At Green Group Remodeling, we’re here to help you bring your ADU project to life. Whether you’re just starting to explore your options or ready to begin construction, our team of experts will guide you every step of the way. Contact us today to start building your ADU with confidence!