Here’s What’s on the Table

San Diego is exploring a major change to its housing policies that could shake up the real estate landscape: allowing accessory dwelling units (ADUs), also known as “granny flats” or backyard homes, to be bought and sold as individual properties.

This proposal is part of a broader package of 25 potential updates to the city’s ADU regulations, which are currently under review. One amendment, in particular, stands out — it would treat ADUs similarly to condominiums, enabling individual ownership of these smaller housing units even when they’re located on the same lot as a single-family home.

“It would be similar to condo mapping,” explained Whitney Hill of SnapADU, a local builder focused on these units. “You’d be able to own just one of the homes on the property.”

Currently, ADUs in San Diego are only allowed to be rented, not sold. These units have been a popular solution for adding more housing in single-family neighborhoods, especially where larger apartment buildings are prohibited. Since 2021, more than 5,700 ADUs have been permitted in San Diego — yet fewer than 900 of those were built using the city’s bonus program that incentivizes affordable housing.

That bonus program has come under scrutiny, especially in neighborhoods like Encanto, where large lots and proximity to transit have made it a target for high-density ADU projects. Residents there expressed concerns, leading the City Council to request regulatory changes earlier this year. One specific issue raised: the lack of for-sale housing options in favor of rentals.

Councilmember Henry Foster III, who represents Encanto, pointed out that the bonus program was inadvertently limiting homeownership opportunities. If the proposed amendments pass, this could shift dramatically. Market-rate ADUs could become more than just rental properties — they could be a pathway to homeownership, particularly for first-time buyers.

This change couldn’t come at a more critical time. San Diego’s median single-family home price recently passed the $1 million mark, and homeownership among residents under 30 remains one of the lowest in the nation, according to LendingTree.

Advocates believe selling ADUs could be a game-changer. Rafael Perez of the Casita Coalition noted that in other states where selling ADUs is permitted, units often sell for 40–60% less than surrounding single-family homes. That price gap could open the door for middle-income buyers who’ve been priced out of traditional ownership.

As Hill puts it, “You’re accessing these standalone homes that you really wouldn’t be able to otherwise.”

If adopted, San Diego’s new approach could not only add much-needed housing but also help bridge the gap between renting and full homeownership — creating a new path to stability for thousands of local families.