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Small Homes, Big Impact
Welcome to the second edition of
Small Homes, Big Impact's
Newsletter!
In this issue, you will find a recap of our latest ADU events, our featured program partner, three big ADU program announcements and more!
ABOUT SHBI
Small Homes, Big Impact is a new pilot program from Housing Trust offering free educational workshops and financial assistance to homeowners seeking to build an accessory dwelling unit (ADU). ADUs are secondary dwelling units to the primary home that can be built as attached units, detached or by converting an existing bedroom or accessory dwelling unit like a garage, depending on what is allowed in the local jurisdiction.
ADUs are a great way to create rental income or provide housing to family such as aging parents and adult children.
The workshops intend to answer the following five questions:
- Can I build an ADU on my site? Review development standards to determine what and where you can build on your site.
- How do I get a permit to build an ADU? Discuss the design and entitlement process.
- How do I hire a builder and manage construction? Review project budget and contracting.
- How do I pay for an ADU? Discuss financing options.
- I'm a landlord, now what? Discuss property management and laws and regulations.
The workshops occur on a quarterly basis and are led by local ADU Practitioners (land use consultants, builders, design professionals, architects, lenders etc.) during a full day course, typically on a Saturday. The workshops are open to homeowners in the greater Bay Area.
The financial assistance program consists of a planning report grant and a construction loan.
The
next quarterly workshop will be held this summer in Sunnyvale -- we will make an announcement when registration opens!
Lastly ...
Please feel free to forward this newsletter to anyone interested in building an ADU; anyone interested in receiving future newsletters, should register on our
interest list
.
HAPPY READING!!!
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Recap of Our Latest ADU Events
South County Event, Morgan Hill, May 4
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South County ADU Workshop
City of Morgan Hill
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On May 4, we co-hosted our fifth ADU Workshop!
Housing Trust partnered with
City of Morgan Hill
for a South County ADU Event - a free, full-day event where app
roximately 200 attendees viewed a 150 square foot, micro-unit provided by
prefabADU.com
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met with vendors (builders, design professionals, and lenders) at the resource fair, and had the opportunity to attend a live workshop led by ADU practitioners.
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(L-R)
Max Seetho, President of Wells Fargo's Silicon Valley Region, Vianey Nava, ADU Program Manager for Housing Trust Silicon Valley and Blanca Gomez, Vice President, Community Relations Associate Manager, Wells Fargo.
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The day started with Housing Trust receiving a $120,000, 2-year grant from the Wells Fargo Priority Markets Program to assist SHBI ADU program to continue to provide resources for homeowners. To read more, click
here for the Mercury News article.
Open House Tour, Sunnyvale, March 23
W
e had anoth
er remarkable turnout at the open house tour in March, when we partnered with Modern Empathy and Soup to showcase a recently completed, 430 square foot, low c
arbon footprint, 1 b
edr
oom/ 1 bath wood frame construction, detached ADU.
The unit features Universal Design Standards, modern European design, attention to light and natural materials, efficient kitchen with ADA-compliant appliances and open floor plan. It also contains energy efficient equipment and appliances such as ductless min-split system for cooling and heating and gas
tank less
water heater, stackable washer/dryer and full kitchen appliances.
Total development cost (including design, engineering, construction and permit and impact fees) was $179,060 ($416 /SF). Project duration from design, permitting and construction took approximately seven months to complete.
For more information, please contact David J. Klein, CEO, of
Modern Empathy
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Garage Conversions: Not as Easy as They Seem
By Greg Popovich, Goldbar Builders, LLC
Yes, your garage can be used as a starting point for your ADU, but there is much more to it than meets the eye. On first look it has four walls, a roof, and a window or two. It is almost done, it will save me a lot of money and almost ready to move in, right? Not in about 85% of the cases.
The process and limitations are far greater than if you were to tear it down and start from scratch. Garages are not made to house humans. They are meant to house cars. Cars can take the cold, the heat, the inside water heater and furnace unit that could leak carbon monoxide, the lack of light, plumbing, energy efficiency, electrical and a level floor. They do not need the latest energy efficiency and really do not mind the walls that lean a little to the left or a little to the right. The only requirement for the car is a very wide opening to drive through, which the garage was made and intended for.
Humans need just about everything that a car doesn't. To design a livable space you need to work around the existing
size, shape, proportions, and height of a garage, which can be extremely limiting and costly. In many instances the conversion ends up being more expensive then you have budgeted and equal to or more than a demo and full rebuild.
Older garages in many instances require new or retrofitted foundations;
lifting the roof to add extra space, adding framing for adequate room for insulation, windows, doors, adding roof trusses for support, relocating water heaters and furnaces, foundation leveling or new slab, wall and roof stabilization and engineering and many upgrades to meet Title 24 energy requirements. After that, the ADU portion can be built.
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Floor Plan, Garage Conversion
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Goldbar recently complete a garage conversion in Santa Clara that turned out beautiful and
economical.
The structure and foundation were sound and part of the main house was utilized to give extra space and made an interesting, floor plan. Newer and permitted garages can be wonderful to convert.
Greg Popovich, Owner
Goldbar Builders, LLC
Spotlight: Greg Popovich,
Goldbar Builders, LLC
How long have you been specializing in ADUs?
With 30 years in the construction industry experience, we started Goldbar Builders, LLC in December 2016. My business partner and I had been involved in both commercial construction, custom home construction and development. We have gotten a bit older and decided that we wanted to give back and help with the severe housing shortage in California.
Number of completed ADUs?
We have built hundreds of custom homes and ADUs. Currently we are working on 20+ ADUs from South San Jose up to the East Bay and we have a division in Santa Rosa to help families displaced by the recent fires.
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Greg Popovich, Owner, Goldbar Builders, LLC and Yuki Ikezi, Planning Commissioner, City of Santa Clara
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Please describe your favorite ADU project?
Even though we specialize in detached, site built ADUs, the most fun that we had was an ADU project that we did for Yuki Ikezi, Planning Commissioner for City of Santa Clara. We converted her garage to an ADU and then built a new garage for her. She was wonderful and really backs the ADU movement. Just seeing how ecstatic she was made it enjoyable. I was able to an ADU podcast, "Then There's California ..." with Senator Wieckowski inside of her new ADU. It was a real honor and we were proud to have been chosen.
Fun Fact:
I am a licensed and bonded auctioneer. Even though I have conducted auctions for museums and a huge Porsche collection, I enjoy charity auctions the most. It is great to know that I can contribute my skills to helping great organizations reach their financial goals and to help those in need.
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Assessor Larry E. Stone Discusses
Building an ADU and Property Taxes
By Larry E. Stone, Assessor
Whether they are called "Granny" or "In-Law" Units, Accessory Dwelling Units (ADU's), are one of many solutions chipping away at California's challenge of providing affordable housing, which has reached crisis proportions in Silicon Valley.
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Larry E. Stone, Assessor
County of Santa Clara
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When home
owners contemplate building an ADU, often to realize a second income, they want to know "will my property taxes go up?". The short answer is yes, but only on the marginal value of the ADU. Assessors throughout California treat ADU's like a home addition. The existing home will not be reassessed. The most recent changes in laws, as of 2019, do not change the way ADU's are assessed.
There are a few variations of ADU's. The most common is a new structure separate from the primary house, typically with a private entrance, kitchen, and bathroom. The new construction (ADU) will be assessed at its market value as of the January 1, (a.k.a. lien date) or for partially completed construction, as of the date of completion.
Typically, Assessors use either the cost of construction or a market-based sales comparison to value the new improvements separately. This new assessment is added to the existing assessment.
Homeowners may not want to add a separate "Granny" Unit, but instead prefer to convert a large family room or garage into an ADU. Though no new square footage is added by a conversion, any alterations of the existing living space will be assessed at market value.
For example, if new heating, bathroom, or kitchen fixtures are added, the cost will be added to the existing property tax base of the area that is modified. Other areas of the home untouched will not be reassessed by the Assessor. However, if the area modified is "taken down to stud walls," making it substantially equivalent to new, it may be reassessed as new.
Whether the addition is for a parent or rented to earn a little extra income, the Assessor's determination of the new assessed value remains the same, and is treated like any other addition to a home.
The Assessor's office features a wealth of information and a brochure about new construction of all types, including ADUs, at
www.sccassessor.org
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Announcements
City of San Jose Proposes Forgivable Loans for ADUs
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(L-R) Monica, Homeowner, Mayor Sam Liccardo, Councilmember Sylvia Arenas, and Kevin Zwick, CEO for Housing Trust Silicon Valley.
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On May 15, San Jose Mayor Sam Liccardo announced measures to incentivize homeowners to build ADUs
at rents affordable to low-moderate income renters. The proposal, which includes a forgivable loan program to cover fees. Housing Trust is thrilled to be identified as the City's program partner. After City Council moves the plan to approval, we will begin program design and implementation.
Click
here
to read Mercury News article.
We will keep you posted with additional details and timing as they become available.
A Sneak Peek to Our SHBI ADU Workshop
Click
here
to watch an hour-long highlight video of our ADU Workshop led by local ADU practitioners (land use consultants, builders, design professionals, architects, lenders etc.) -- a teaser
to the free, full-day live ADU Workshop.
If you would like to attend a live ADU instruction workshop, please join us in Sunnyvale in August - stay tuned for a registration announcement!
SHBI's Financing Program Update
SHBI's financing program consists of a planning grant and construction loan. To be eligible homeowners must complete an ADU workshop and live in Santa Clara County, we will expand the program to other counties as funding becomes available.
The planning grant is for a consultant to complete a site assessment of the property and determine if you can build an ADU and if so, what can be built. We have made 17 grants to date and we will make an announcement when the application period is open again -- more details to come.
We will have soft launch of the construction loan program this summer and we will be inviting homeowners that have completed an ADU workshop to apply. The contemplated loan terms consist of a maximum of $200,000 loan amount for 36 months at about 5% interest with tenant income restrictions --
loan terms are subject to change.
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Events & Resources
UPCOMING EVENT
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Summer 2019
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ADU Workshop, Sunnyvale
We will make an announcement when registration opens -- stay tuned!
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SHBI ADU RESOURCES
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