Local costs and rules
A Plain Guide to ADUs and Granny Flats in the Sacramento Region
What an ADU or JADU is, what California law allows, how permits work locally, and how an ADU affects rent, loans, family and property tax.
What is an ADU, and what is a JADU?
An accessory dwelling unit, or ADU, is a second, complete home on the same lot as a house. It has its own place to sleep, cook, eat and bathe. People also call it a granny flat, an in-law unit or a backyard cottage. The City of Sacramento's ADU page (checked October 22, 2026) describes it as a permanent unit that can share a wall with the main house or stand on its own.
There are three common shapes:
- Detached. A separate small house in the backyard.
- Attached. An addition that shares a wall with the main house.
- Converted. A garage, a room or other existing space turned into a unit.
A junior ADU, or JADU, is smaller and lives inside the house. The state housing department's ADU Handbook (March 2026) says a JADU is no more than 500 square feet of interior living space and sits entirely within a single-family home. It can have its own bathroom or share one with the main house. An attached garage counts as part of the house for this purpose.
What does California law say about building an ADU?
California's ADU rules are now in Government Code sections 66310 through 66342. The HCD ADU Handbook (March 2026) explains that SB 477 (Chapter 7, Statutes of 2024) renumbered the old sections, such as 65852.2, into this new chapter. If you read an older article that cites 65852.2, the ideas may still apply, but the section numbers have moved.
Here are the rules most homeowners ask about, as the Handbook describes them:
- A 60-day clock. When a complete ADU or JADU application comes in for a lot that already has a home, the permitting agency has to approve or deny it within 60 days (Gov. Code sections 66317 and 66335). A denial must come with a written list of what to fix.
- No owner-occupancy rule for ADUs. A city or county cannot require you to live on the property to have an ADU (section 66315). A JADU is different: if it shares a bathroom with the main house, the owner must live in one of the two (section 66333(b)).
- Rentals longer than 30 days. Local rules can require that ADUs and JADUs be rented for terms longer than 30 days, which rules out nightly rentals in many places (sections 66315, 66323(e) and 66333(g)).
- Size floors. A local size cap has to allow at least 850 square feet, or 1,000 square feet for an ADU with more than one bedroom (section 66321(b)(2)).
- Parking. Parking for an ADU can't be more than one space per unit or bedroom, whichever is less (section 66314(d)(10)).
- "66323 units." Section 66323 lists certain ADUs that must be approved under a short set of state standards. One example is a detached unit up to 800 square feet with four-foot side and rear setbacks.
Local rules still matter for height, design and setbacks within what state law allows. This page is general information, not legal advice. For a specific lot, the city or county planning counter has the final word, and a land use attorney can help with anything unusual.
Can you sell an ADU separately from the main house?
Usually not. The HCD Handbook (March 2026) says a city or county may adopt an ordinance that allows the house and the ADU to be sold separately as condominiums, if it meets the rules in Government Code section 66342. Section 66341 adds a narrow exception for certain units built by qualified nonprofits.
So in most places, the ADU goes with the house when you sell. That shapes how you think about it. An ADU adds living space and possible rent to one property. It isn't a second lot you can sell off later.
How do you get an ADU permit in Sacramento, Elk Grove, Roseville or the county?
Your permit comes from whoever runs building permits where the home sits. That is the city if you're inside city limits. It is the county if you're in an unincorporated area such as Carmichael or Fair Oaks.
- City of Sacramento. The city's ADU page (checked October 22, 2026) points to its ADU Resource Center as a one-stop source. It also offers free permit-ready ADU plans for city residents.
- Unincorporated Sacramento County. The county announced free "shelf ready" detached ADU plans on July 10, 2024, for residents of unincorporated areas only. The designs ranged from 460 square feet up to 1,184 square feet. The plans can't be changed, and you submit a site plan showing where the unit goes. The plans were checked to the 2022 building code, so ask whether they've been updated for the current code.
- Elk Grove, Roseville, Rocklin, Lincoln, Davis, El Dorado Hills and others. Each city, and El Dorado County for El Dorado Hills, has its own planning and building counter. Many offer pre-approved plans. The HCD Handbook says state law required local agencies to set up a program for pre-approving ADU plans by January 1, 2025.
A simple way to start: call the planning counter, give them your address, and ask three questions. What zone is my lot in? What setbacks and height limits apply to an ADU here? Do you have pre-approved plans? Write down the answers and the name of the person you spoke with.
What does an ADU cost to build?
Costs swing widely, so we won't quote a single number. A garage conversion or JADU inside the house usually costs less than a new detached cottage, because the walls, roof and foundation already exist. A detached unit costs more but gives the most privacy.
Here's what goes into the total:
- Design and plans. Free pre-approved plans can cut this cost.
- Permits and fees. The HCD Handbook (March 2026) says an ADU of 750 square feet or less, or a JADU of 500 square feet or less, can't be charged impact fees. Larger ADUs can be charged fees in proportion to their size. Permit and plan-check fees still apply.
- Utilities. Running water, sewer and power to a backyard unit can be a big line. The Handbook says a conversion inside the existing space generally can't be required to have its own new utility connection. A new detached unit may be.
- Site work and construction. Foundation, framing, finishes and any trees or slopes in the way.
Get at least two written bids from licensed contractors, and check each license with the Contractors State License Board. Ask each bidder what is not included. Utility runs and permit fees are where surprises usually hide.
Can an ADU bring in rental income, and how do you pay for one?
Yes. An ADU can be rented, subject to the 30-day rule your city or county may set. With 11 years as a landlord, Maggie looks at rent the same way an owner should. Count the rent you'd collect. Then subtract vacancy, repairs, the added insurance and the added property tax. Then compare what's left to your monthly cost to build.
The common ways people pay for an ADU:
- Cash or savings. Simple, with no new payment.
- A home equity line of credit. Borrow against the equity you already have. See our HELOC page.
- A cash-out refinance. Replace your current loan with a larger one. See our refinance page.
- A renovation loan. Some renovation loans base the loan on the value after the work is done. See our renovation loan page.
- A construction loan. Funds are released in stages as the work is done. See our construction loan page.
Whether a lender will count future ADU rent toward your income depends on the loan program. Ask about it before you apply. As a mortgage broker, Maggie can lay several options side by side so you can see the monthly cost of each.
The HCD Handbook (March 2026) notes that CalHFA's ADU Grant Program, which reimbursed some pre-construction costs, had run out of funds at the time it was written. Some cities create their own help or waive fees, so ask your planning counter.
Is an ADU a good way to keep an aging parent close?
For many families, yes. The HCD Handbook lists keeping extended families near one another, with privacy, and helping older adults age in place among the benefits of ADUs. A parent in a backyard cottage has their own front door and kitchen. You're 50 feet away, not 50 miles.
A few things to plan for if a parent will live there:
- Single-level living. No steps at the entry, a walk-in shower and wider doorways are easier to build in from the start than to add later.
- Lighting and paths. A well-lit, level path between the houses matters at night.
- Money and fairness. If a parent helps pay for the unit, write down the arrangement. That keeps siblings informed and protects everyone if plans change.
- Selling the parent's home. If the parent is moving from their own house, that sale may fund the ADU. Our Well MOVED program plans both moves together.
Maggie holds the CAPS (Certified Aging-in-Place Specialist) designation. Our aging-in-place home check and the home safety guide cover the details that keep a parent safe.
Does building an ADU raise your property tax?
Yes, but usually only for the new part. Under Proposition 13, new construction gets its own assessed value while the rest of your home keeps its existing value. The Board of Equalization's guidance on new construction (Property Tax Rule 463) says only the value added by the new construction is added. A 2017 law (AB 652) says construction in progress doesn't get its own base year value until it is complete.
When the work is finished, the Board of Equalization's supplemental assessment page (checked October 22, 2026) explains that completed new construction can lead to a supplemental bill. That bill is prorated from the first day of the following month to the end of the fiscal year. It comes separately from your regular tax bill, so set money aside for it.
To estimate the yearly effect, try our Sacramento property tax calculator with the added value. This is general information, not tax advice. Your county assessor and a CPA can tell you how your project will be valued.
Does a home with an ADU sell differently?
An ADU can widen your pool of buyers. That includes families who want a parent nearby, buyers who want rent to help with the payment, and people who work from home. Buyers and their lenders will ask a few questions, so have the answers ready:
- Was the unit permitted and finaled? Keep copies of the permit and the final inspection.
- Is it rented, and on what terms? A tenant's lease affects the sale. See our guide to selling with tenants.
- Does it have separate utility meters?
The HCD Handbook says a local agency can't deny a permit for an unpermitted ADU built before January 1, 2020, only because it fails building standards or ADU rules, with some health and safety exceptions. If you own an older unpermitted unit, ask your city about legalizing it before you list. If you're buying, our investment property page and the guide to evaluating a rental walk through the numbers.
How do you get started on an ADU?
Start with your address and your goal: rent, room for a parent, or both. Then:
- Call your city or county planning counter with the three questions above.
- Look at their pre-approved plans before paying for custom design.
- Get two or three bids and a financing comparison side by side.
- Run the rent and tax numbers before you commit.
Maggie can help with both halves: what the ADU does to your home's value, and how to pay for it. Send us a note or call Maggie's cell at (916) 549-3131. If you're curious what your home is worth today, start with our home value tool.
Frequently Asked Questions
What is the difference between an ADU and a JADU?
An ADU is a complete second home on the lot, attached, detached or converted. A JADU is no more than 500 square feet of interior living space and sits entirely inside a single-family home, according to HCD's ADU Handbook (March 2026).
Do I have to live on the property to build an ADU?
No. HCD's Handbook says a local agency can't impose an owner-occupancy requirement on an ADU (Gov. Code section 66315). A JADU that shares a bathroom with the main house does require the owner to live in one of the two.
How long does the city have to approve an ADU permit?
Once a complete application is received for a lot with an existing home, the permitting agency has to approve or deny it within 60 days, per Government Code sections 66317 and 66335 as described in HCD's Handbook.
Can I rent my ADU on Airbnb?
Often not. State law lets local agencies require ADU and JADU rentals to be longer than 30 days. Check your city or county's rules before you plan on short stays.
Will an ADU raise my property taxes?
Usually only for the new construction. The added value gets its own assessment and the rest of your home keeps its existing value. Expect a supplemental bill after completion. Ask your county assessor and a CPA about your project.
Are there free ADU plans in Sacramento?
The City of Sacramento offers free permit-ready plans for city residents, and Sacramento County announced free shelf-ready plans on July 10, 2024 for unincorporated areas. Other cities have their own pre-approved plan programs.
Can I sell the ADU separately?
Usually not. HCD's Handbook says separate sale as condominiums is allowed only where a city or county adopts an ordinance under Government Code section 66342, plus a narrow nonprofit exception in section 66341.
How can I pay for an ADU?
Common options are cash, a home equity line of credit, a cash-out refinance, a renovation loan or a construction loan. Maggie can compare the monthly cost of each for your situation.
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