ADU law updates

Most single-family lots in California can add one ADU and one junior ADU (JADU). Two laws that took effect January 1, 2026, speed up permits and narrow the owner-occupancy rule for JADUs.

New on January 1, 2026

• SB 543: cities must tell you within 15 business days whether an ADU application is complete. If they miss that deadline, the application is deemed complete. The 60-day clock to approve or deny still runs from a complete application.
• SB 543: ADUs and JADUs of 500 square feet or less of interior livable space are exempt from school impact fees. Size limits for detached ADUs count interior livable space.
• AB 1154: a JADU requires the owner to live on the property only when the JADU shares a bathroom with the main home. A JADU with its own bathroom has no owner-occupancy rule.

The core rules

• One ADU and one JADU on most single-family lots. A JADU is a unit of up to 500 square feet inside the main home.
• Cities must approve or deny a complete ADU application within 60 days.
• Side and rear setbacks for an ADU can't be more than 4 feet.
• You don't have to live on the property to build or rent an ADU (AB 976 made this permanent).
• Cities can't charge impact fees on an ADU of 750 square feet or less.
• Many ADUs built without permits before 2020 can now be legalized. A city can deny legalization only for a health or safety problem (AB 2533).

Selling an ADU separately

Most ADUs can't be sold apart from the main home. AB 1033 lets a city opt in to selling ADUs as condos. San Jose was the first city in California to opt in, and it is the only city on this site that has so far. Selling one takes a condo plan, inspections, and consent from every lender on the property.

What it means when you buy or sell

• A permitted ADU counts as a legal unit. An unpermitted one can be hard to insure, rent, or finance, so check the permit history before you price it in.
• Buyers pay for lot potential they can see and trust. A designer's feasibility read before you list shows what the lot can hold.
• Ask the city for the current ADU ordinance. Cities must send their ordinances to the state, and the state reviews them for compliance.

Sources: California HCD: Accessory dwelling units, SB 543 (2025) bill text, AB 1154 (2025) bill text.

General information as of October 21, 2026, not legal or tax advice. Rules change and local ordinances differ. Confirm the details for your property with the agency named above, an attorney, or a tax advisor.