S.F. passes law to let homeowners sell new in-law units as condos

The San Francisco Board of Supervisors unanimously passed an ordinance allowing property owners to build in-law units that can be sold separately as condos. This move aims to increase the number of accessory dwelling units (ADUs) in the city, which added only about 1,300 units from 2020 to 2024. Sponsored by Supervisor Joel Engardio, the legislation targets homeowners with single-family homes or small condominiums and is designed to help low-income families unlock the wealth in their properties. Engardio emphasized the potential for homeowners to maximize their most valuable asset without selling their homes. The new in-law units must be constructed after May 1, 2025, to mitigate concerns over the displacement of rent-controlled tenants in older ADUs.

The ordinance supports the city’s goal of building 82,000 housing units by 2031 without raising building heights, addressing local opposition. Engardio plans to propose further legislation to allow homeowners to defer building permit fees, encouraging more development of ADUs. This initiative reflects a broader effort to create affordable, entry-level homes in a city facing significant housing challenges.