San Jose Homeowners Can Now Sell ADUs as Condos

A new policy could help boost the supply of smaller, more affordable ‘starter homes’ in the first California city to legalize the sale of ADUs.

2 minute read

August 19, 2024, 12:00 PM PDT

By Diana Ionescu @aworkoffiction


Historic Victorian houses in San Jose, California.

Sundry Photography / Adobe Stock

The city of San Jose became the first in California to allow the sale of accessory dwelling units (ADUs) as condos, which supporters say will create a new supply of ‘starter homes’ for households looking to become homeowners. In a city where just 6 percent of residential land is zoned for multifamily housing, the policy could have a major impact on San Jose’s housing supply.

As Vicente Vera explains in San Jose Spotlight, the change was made possible by AB 1033, signed by Governor Gavin Newsom last year, which lets municipalities set their own rules on ADU sales.“With more than 1,400 new ADUs built since 2019 and thousands more in development across San Jose, city leaders hope to alleviate the affordable housing crisis with the help of existing homeowners.”

According to Rafael Perez, board president of the affordable housing advocacy nonprofit Casita Coalition, ADU condos typically sell for 40 to 60 percent of the average home price in their area. However, Todd Langton, executive director of homelessness nonprofit Agape Silicon Valley expressed concern that institutional buyers could take advantage of the law and suggested policies to prevent purchases by investors.

According to an article in The Real Deal, “Unlike the controversial Senate Bill 9, which allows homeowners to create two separate lots, a homeowner using AB 1033 must set up a homeowners association for the main house and ADU “condo.” Governing documents would determine how common areas, such as a shared yard, would be maintained and fixed.”

Thursday, August 15, 2024 in San José Spotlight

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Get top-rated, practical training

Bird's eye view of manufactured home park.

Manufactured Crisis: Losing the Nation’s Largest Source of Unsubsidized Affordable Housing

Manufactured housing communities have long been an affordable housing option for millions of people living in the U.S., but that affordability is disappearing rapidly. How did we get here?

March 25, 2025 - Shelterforce

U-Haul truck on road with blurred grassy roadside in background.

Americans May Be Stuck — But Why?

Americans are moving a lot less than they once did, and that is a problem. While Yoni Applebaum, in his highly-publicized article Stuck, gets the reasons badly wrong, it's still important to ask: why are we moving so much less than before?

March 27, 2025 - Alan Mallach

Rusty abandoned oil well and equipment with prickly pear cactus next to it in West Texas.

Using Old Oil and Gas Wells for Green Energy Storage

Penn State researchers have found that repurposing abandoned oil and gas wells for geothermal-assisted compressed-air energy storage can boost efficiency, reduce environmental risks, and support clean energy and job transitions.

March 31, 2025 - Pennsylvania State University

Colorful blocky apartment building facade.

Minneapolis Bans Rent-Setting Software

Four cities have enacted restrictions on algorithmic software that can inflate rent costs.

April 1 - Stateline

Silver electric BMW car parked in driveway of home in Oakland, California.

Oakland to Add 244 New EV Chargers

Oakland plans to launch its new charging network at eight locations by the end of 2025.

April 1 - City of Oakland

Sculpture of seated Jane Goodall holding hands with chimp on green lawn.

Jane Goodall Inspires with Message of Hope, Resilience, and Environmental Action

Speaking in Pasadena, Jane Goodall offered a hopeful and inspirational message, urging global compassion, environmental responsibility, and the power of individual action to shape a better future.

April 1 - Pasadena Star-News