San Diego homeowners have likely heard of accessory dwelling units (ADUs) — also referred to as a granny flat, in-law suite, or duplex. An ADU is a secondary residence on a single lot. The structure must function independently, but it won’t have a separate address. Many homeowners consider building an ADU because of the lack of affordable housing. San Diego is an expensive place to live. The median price for single-family homes increased by 19.9% to $875,000. Homeowners can cover the costs of a mortgage payment by supplementing with the rental income ADUs generate.

It’s a win-win for everyone since the land on which the structure is built belongs to the homeowner. The expense to create a secondary residence is for the system only — and the lot is free.

Although ADUs are now permitted in California, homeowners still face a few hurdles with the construction process. Those seeking to build an ADU struggle with financing, building permits, and more.

How can you solve the biggest challenges to constructing an ADU?

1. Approval and Permitting

The biggest challenge you may face with building an ADU is government approval and permitting. Many homeowners struggle with this process because of the time and complexity. In addition, they also feel their jurisdiction imposes unnecessary restrictions during the process.

Even construction businesses have to navigate through various departments’ requirements. ADUs have strict legal provisions you have to follow and your local municipality will review their compliance. For instance, each structure must maintain a certain distance from the property line, curb, and system from another building. For San Diego, a minimum setback must be situated 4 feet from the side and rear lot lines.

To ensure a smooth approval process, see if your property is eligible for building an ADU. In San Diego, you can ensure your lot is per the development standards. Here are a few things to consider:

  • Property qualifications: You can build an ADU if it is zoned for single-family or multifamily residence. However, it’s best to check with the city before building on the land. Another factor worth noting is that ADUs in San Diego must always be rentable and may not be sold separately from the main home.
  • Parking: Parking accommodations are another matter where the variables are based on zoning and location. Additional parking isn’t typically a requirement in San Diego. However, it depends on the zoning.
  • Maximum height: Your county can limit how tall the new building is in your area. Your ADU has to meet the limits to receive a permit.

2. Supply

The manufactured housing market is facing supply chain issues. In fact, 90% of construction businesses report material shortages for components like plywood, framing, plumbing fixtures, and other materials.

Construction managers can overcome this barrier by being flexible with their stock. You should get the product through the door and manage it accordingly. However, there needs to be a fine balance between choosing the right items and avoiding certain pitfalls. For instance, you have to consider products’ shelf lives and pricing. 

In the construction industry, you must rely on having the materials on-site when required. Being stocked up and having items readily available is crucial. However, the only way to obtain this is to plan far in advance. That way, you can reduce delays and keep costs down.

3. Design

Another challenge homeowners face is the design constraints. You could come up against standards that halt the process altogether.

Unlike a traditional renovation, ADUs are an entirely new build, requiring more architectural and engineering expertise. Here’s what you should look for to ensure this constraint will not bog you down:

  • Preapproved plans: Private licensed architects and engineers’ design plans accommodate various conditions. Once an applicant selects an approved plan, a member will review the site’s factors for your property. You can find several blueprints that have already gone through the approval process.
  • Setbacks: ADU ordinances for San Diego limit the maximum size to 1,200 square feet and can be up to 850 square feet with ADUs with more than one bedroom.
  • Utility connections: ADUs will have access to sewer and water service when connected to the mainline of the primary residence. You must ensure the design coordinates are per the main sewer and water service. 

4. Financing and Costs of Construction

Certain homeowners may struggle with the cost of building an ADU. In fact, some have issues with obtaining financing and associate it as the top challenge for constructing one. The general price to construct an ADU is about $150,000, or $250 per square foot.

Moreover, there are additional fees with making an ADU, such as taxes, licenses, utilities, and upgrades. San Diego imposes several costs, including a plan review and permit fee.

Additionally, you’ll have more fees that add costs depending on the size of the ADU. For example, you could pay 33 cents per square foot in addition to the plan review and 43 cents per square foot for the permit. 

There are numerous ways to obtain financing. The first obvious way is to pay cash. However, you can also receive a low-interest construction and renovation loan to finance your project.

Another option is to refinance your mortgage, which will provide you with a lump-sum payment. You can then repay it over time with your monthly mortgage.

You may also have the opportunity to get a home equity loan or a home equity line of credit. Home equity loans will provide you with a fixed amount of cash and a repayment schedule. Likewise, a home equity line of credit will be structured as a revolving line of credit and shorter repayment terms. 

Some homeowners may find it difficult to obtain traditional loans. Savvy people will typically get a personal loan and consolidate it into their mortgage to get a better interest rate once the ADU is complete.

Overcome the Hurdles of an ADU

Building an ADU doesn’t have to be a challenge. There are many ways to overcome the biggest issues you will face. Spend time researching the ordinances and be ready to ensure you experience a smooth process from the start.


In case you have any architectural, structural, and MEP design including fire sprinkler design requirements, or need multifamily ADUs design including structure, and HVAC design, feel free to contact us.  We provide you with the full permit set design + T24 for your request.



Author Bio:

Rose is the managing editor of Renovated. She’s most interested in sharing home projects and inspiration for the most novice of DIY-ers. These are the values she developed growing up in a family of contractors.