San Diego's ADU Rules Are Shifting: Value Plays Now

Thinking about adding an ADU or buying a home with one in San Diego? The rules just shifted, and the right move can unlock income, flexibility, and long-term value. You want clear answers on what changed, what still pencils, and how to avoid costly surprises. In this guide, you’ll learn the key updates, the value plays for buyers, sellers, and owners, and the practical steps to take next. Let’s dive in.

What changed in 2025

San Diego adopted a new package of ADU updates effective August 22, 2025 outside the Coastal Zone. The changes align with recent state laws, update the City’s ADU Home Density Bonus program, add fire-safety setbacks in hazard zones, and clarify allowable unit counts and setbacks. You can review the City’s summary on the regulatory updates page for complete details and effective dates. See the City’s regulatory updates.

State law now requires a local preapproved ADU plan program that can speed permits when you use an approved design. In many cases, a detached ADU using a local preapproved plan must be approved or denied within 30 days. The California Department of Housing and Community Development explains the new preapproved plan rules in its updated ADU handbook. Review HCD’s ADU guidance.

San Diego’s ADU Home Density Bonus program remains but is narrower than before. Some RS zones are excluded unless the site is in a High or Highest Opportunity Area, and the City has added caps that limit how many bonus ADUs you can build based on lot size. Confirm the latest eligibility and caps in Information Bulletin 400. Check Information Bulletin 400.

Safety and site constraints matter more. ADUs in High or Very High Fire Hazard Severity Zones face at least a 4-foot side and rear setback, with the Fire Department able to require more in some cases. Parking rules also shifted. There are no parking minimums in Transit Priority Areas for new residential development, while some bonus ADU projects outside TPAs may require one space per ADU. Get details on the City’s changes.

Separate sale of ADUs is possible where local rules allow it. State law AB 1033 lets cities opt in to permit ADUs to be sold separately as condominiums, subject to local subdivision and condo mapping requirements. San Diego’s package moves toward enabling separate sale, so verify the City’s current ordinance and checklist before you plan for a condo map. Learn how AB 1033 works.

How the new rules affect value

Permitted ADUs still help properties stand out by adding flexible living space and potential rental income. Research shows ADUs can increase marketability and, in many cases, overall value, though results depend on costs, rents, and comparable sales. The City’s tightening of the bonus program reduces “buildability” on some parcels, so raw development upside is not as expansive as it was. See Terner Center’s analysis of San Diego’s ADU program.

Here are the biggest drivers to watch:

• Permitted status and quality of the ADU.
• Any deed restrictions on bonus or affordable ADUs that limit rent.
• Whether the parcel is in a TPA, which affects parking requirements.
• Fire hazard zone setbacks that can reduce buildable area.
• The potential to pursue separate sale if and when the City’s rules are finalized.

Value plays for sellers

If your property already has a permitted ADU, spotlight compliant permits, separate utilities if applicable, and current rent terms. Buyers often value a clear income story and turnkey living flexibility. If the ADU is deed restricted through the City’s bonus program, disclose the recorded restrictions so buyers can model cash flow accurately. Confirm deed-restriction details via Information Bulletin 400.

If separate sale becomes available for your site, explore whether condo mapping the ADU could create additional exit options. You will need to meet subdivision and condominium requirements, which can include separate utilities and inspections. Start with the City’s ordinance status, then review AB 1033’s framework to understand the steps. Read AB 1033 fundamentals.

Seller checklist:

• Verify permit history and legal status for any ADU or JADU.
• Pull recorded documents to identify rent restrictions on bonus units.
• Confirm whether your parcel is in a TPA and in a fire hazard zone.
• If considering separate sale, monitor the City’s ordinance and consult a condo mapping team.

Value plays for buyers

If you are comparing homes with and without ADUs, weigh the benefits of an existing permitted unit against the cost and time to build. A permitted ADU with clear documentation can be easier to finance and insure. If the unit is part of the bonus program, model the rent cap’s impact on income. Use the City’s ADU guide for permit basics.

If you plan to build, verify what is allowed today. The City has capped bonus ADUs on some lots and excluded some RS zones unless they are in High or Highest Opportunity Areas. Parcels in TPAs benefit from no parking minimums, while some bonus projects outside TPAs may require one space per ADU. Review San Diego’s regulatory update page.

Run the numbers on both income and resale. Studies show ADUs can add value and monthly income, but returns vary with build cost, financing, and comps. Use conservative rent assumptions and consider whether deed restrictions apply. See Terner Center’s findings.

Value plays for owners building now

Use preapproved ADU plans to speed permits. State rules direct cities to set up preapproved plan programs, and qualifying detached ADUs using a local preapproved plan can trigger a 30-day review clock. Check San Diego’s standard plan library as it comes online, alongside HCD’s handbook for statewide guidance. Read HCD’s ADU handbook.

Plan for safety and site constraints early. In High or Very High Fire Hazard Severity Zones, expect at least 4-foot side and rear setbacks and possible Fire Department conditions like sprinklers and access. These standards affect placement and cost, so factor them into your layout first. See the City’s current standards.

Explore financing that lowers out-of-pocket costs. The San Diego Housing Commission’s ADU Finance Program offers construction-to-permanent loans up to $250,000 and technical assistance for eligible owners. Income limits and deed-restriction terms apply. Explore SDHC’s ADU Finance Program.

Budget for program-specific requirements. The ADU Home Density Bonus Program can require automatic fire sprinklers and a Community Enhancement Fee for some smaller bonus ADUs, with fee waivers available in identified high-resource areas when units are deed restricted to certain incomes. Confirm current program details on the City site.

If you are in unincorporated San Diego County, state ADU rules apply with local procedures layered on top. Start with HCD’s statewide guidance, then confirm County process specifics before design. Review statewide ADU rules at HCD.

What to watch next

Local policy is still evolving. City Council actions in 2025 scaled back parts of the bonus program and set new caps, and further adjustments are possible. Keep an eye on City updates and coverage that tracks how the policy is landing on the ground. See Axios reporting on recent council actions.

State policies continue to change as well. HCD regularly updates guidance, and new legislation could influence where and how ADUs and small-scale infill are encouraged. Check HCD’s ADU page for updates.

Valuation and lending are not fully standardized. Researchers note that financing and appraisals for ADUs are still maturing, which can affect your realized return. Build in margin and use local comps to stay conservative. Read Terner Center’s program insights.

Design-led help, start to finish

You deserve a clear plan and a polished outcome. Whether you want to buy a home with ADU potential, sell a property with a permitted unit, or design and manage an ADU for rental income, we combine senior-agent representation with AutoCAD planning, design, and turnkey leasing and management. Ready to map your best move in today’s rules? Connect with Laura Valente to start a tailored ADU strategy for your property.

FAQs

Can you still build multiple ADUs on one lot in San Diego?

• State law allows at least one detached ADU, one converted ADU, and a JADU where eligible, while San Diego’s revised bonus program adds caps and excludes some zones, so verify your parcel’s current eligibility.

How fast can a preapproved ADU plan get permitted under the new rules?

• If you use a local preapproved plan, certain detached ADU applications must be approved or denied within 30 days under state rules, subject to local implementation.

Can you sell an ADU separately from the main home in San Diego?

• AB 1033 lets cities opt in to allow ADUs to be sold as condominiums, and San Diego is moving toward local enabling rules, so confirm the City’s current ordinance and any condo mapping requirements.

Do ADUs require parking in San Diego now?

• There are no parking minimums for new residential development in Transit Priority Areas, and some bonus ADUs outside TPAs may require one parking space per ADU.

Will an ADU always increase your property’s value more than it costs?

• Not always; returns depend on construction cost, financing, comparable sales, and any deed restrictions, so model both rental income and resale value with conservative assumptions.