Will New York Copy California’s Most Successful Housing Reform?

California’s approach to legalizing additional types of housing has been a remarkable success story that is being used as an inspiration for other reforms.

Legislators in the Golden State passed several bills over the years that made it easier for homeowners and local authorities to construct accessory dwelling units (ADUs), also known as granny flats or In-Law suites.

This is one of few YIMBY-inspiring zoning reforms which has resulted in more housing being constructed. Other cities and states with similar affordability problems are now considering deregulating their ADUs.

New York’s Governor Kathy Hochul released her 200-page State of the State legislative agenda last week. Kathy Hochul (Democrat) released her 200-page State of the State legislative plan. It took aim at the local regulations that prohibit homeowners from converting their attic or garage into new housing units.

According to the State of the State, ADUs can “provide affordable multi-generational housing options that help families live closer together.” ADUs are not permitted in certain communities due to current land-use restrictions.

According to the governor’s agenda, she will propose legislation that requires localities permit at least one ADU for owner-occupied residential properties. According to the agenda, this legislation will also stop localities from adopting rules which legalize ADUs in theory but block their construction.

It is an example of California’s ADU experiences, which have seen state laws permitting homeowners to create a backyard home since the 1980s.

Cities have been trying to block their construction for many decades by making it impossible to park on the streets, make them smaller than necessary, and requiring that special permissions be granted to allow for building.

To really get ADU construction going, it took several bills to pass between 2016-2019, which limited the requirements of localities for ADUs. Then came several lawsuits to enforce these new rules.

These results are quite amazing.

According to data from state housing, the number of ADUs allowed in the State rose to just above 1,000 in 2016, to more than 12,000 by 2019, as per state housing data. Bloomberg. Nearly 25% of all new Los Angeles homes that were permitted in 2018 had ADUs.

Nolan Gray, an ex-planner in New York City, and current researcher at University of California Los Angeles, believes there could be a similar boom for New York City, and the surrounding communities, if ADU regulations weren’t liberalized.

Gray, a Queens-based city planner, recalls receiving weekly phone calls from those who wanted to create accessory dwelling units. They called because they needed a younger adult to move in, an elderly parent to remain in their home, or a senior homeowner to have an extra income source.

Gray points out that Queens, Staten Island and some parts of Brooklyn, New York, all have many neighborhoods which are restricted to single-family homes. It is forbidden for homeowners to add a second unit.

Gray claims that although two units are technically allowed by zoning rules, Gray points out that additional requirements on building size, off-street parking, and other restrictions have been in place to prohibit ADUs. New York City’s 9 percent residential zone is single-family. In another 16% of the city, a maximum of 2 units is allowed.

Hochul’s proposal to pass ADU legislation comes on the heels the Connecticut reforms that were passed successfully in June 2021.

Starting this year, Connecticut homeowners will be able to create an ADU on land already zoned for one-family-only houses. Localities will generally be prohibited from making regulations regarding these units that don’t apply to principal residences under the Connecticut reforms.

They would have to be granted “as right,” so their approval won’t depend on whether local officials or neighbors approve.

New York Sen. Pete Harckham (D, W.F.–South Salem) proposed similar reforms early last year. The Judiciary Committee of the New York Senate is considering his bill. It would also require that localities allow ADUs to be permitted on residential-zoned properties.

Harckham’s bill would prohibit cities or towns from mandating off-street parking of ADUs, unless the location is far enough from public transit to allow for this. Although localities may still have the power to regulate the dimensions, height and design of ADUs they can’t make rules that “unnecessarily hamper the creation”

Harckham’s bill, like California and Connecticut, would prevent local governments depriving homeowners of the right to attend public hearings. It also gives bureaucrats full discretion over whether to refuse permits to code-compliant ADUs.

Gray says that these details would guarantee more units get built, should Harckham’s bill pass.

Gray argues that ADUs cannot be used for short-term rental (i.e. Gray claims that the bill’s provisions prohibiting ADUs from being short-term rentals (i.e., AirBNBs), and mandating tight eviction protections to renters of ADUs will “on the margins make homeowners less likely to build ADUs.”

Gray explains that the accessory dwelling units are often owned by the homeowners. They want to be able to control who is living in their attic, basement, or garage. Gray says that you don’t need rules that restrict your freedom. [homeowners]You are able to construct an ADU.

In New Jersey, state Sen. Trey Singleton (D–Burlington) introduced a bill at the tail end of last year’s legislative session that would have, like Connecticut, allowed homeowners to build ADUs on their property, and put limits on how much parking and utility fees localities could impose on these new units. However, Singleton’s bill and a companion bill in the New Jersey Assembly did not make much legislative progress by 2021.

New York’s momentum in housing reform is however on their side for 2022.

Hochul also proposed other supply-expanding reforms as part of her State of the State Agenda. It includes lifting the restrictions on New York City’s high-density building, as well as allowing offices and hotels to be transformed into housing units.

Michael Hendrix is the director of the Manhattan Institute’s state and local policies. He says that New York was “recently behind California when it comes to housing reform.” New York state legislatures and senators are working to get caught up.

ADU reform, if California’s example is anything to go by, should be easy for politicians to approve. Despite numerous attempts to make it possible for denser housing in close proximity to transit stops by state lawmakers, they have not been successful in spite of the determined opposition from NIMBY homeowners (not in our backyard) and left-wing activists concerned about the possibility of gentrification or displacement of renters with lower incomes.

ADU legalization is often a win for homeowners who also see the benefit of creating rental housing units on their properties. This is because these units can be constructed in highly-affordable areas, which makes them less likely to stir up activists’ worries about overdevelopment.

Granted, granny apartments will not solve the high housing prices in New York and California. However, these reforms are an important part of the solution.