In Today’s Email

• ADUs

• Quick Reads

• Executive Summary

What is an ADU?

• An Accessory Dwelling Unit, commonly known as ADU, is a secondary housing unit located on the same lot as a primary residential unit. ADUs are typically smaller in size and are designed to provide additional housing options on a property, such as accommodating extended family members, generating rental income, or serving as a flexible living space.

• ADUs are becoming increasingly popular in the housing market. Earlier this year in January, Freddie Mac published findings relating to ADUs noting that 71% of respondents were unfamiliar with the concept.

Inventory

• As housing inventory remains stagnant, the addition of ADUs could help increase the overall available housing stock, especially in areas with larger populations.

• Since 2020, Groundfloor has been reviewing ADU projects and has noticed a steady increase in demand for ADU financing, particularly in California.

What are ADU’s being used for?

• Effective January 1, 2023, California has passed legislation that allows for 2-story ADUs in some cases and provides more flexibility in their location on a property.

• The Atlanta Journal Constitution in an opinion letter by Nedra Rhone comments this way: “ADUs have many positives. They are suited to intergenerational living and can allow elderly residents to age in place even as neighborhoods gentrify. They provide income to homeowners who can keep rental costs low since they already own the land. They give renters the opportunity to live in a community they may not otherwise be able to afford. Innovative placement of ADUs – many are not visible from the street – can create extra housing without significantly changing the character of a neighborhood.”

Quick Reads Around The Block

• And for the THIRD week in a row...Mortgage demand is on the rise! 

• West vs South

• Owners with a 3% mortgage rate are calling themselves prisoners

Executive Summary From PD

“Financing ADUs will be a growth area for Groundfloor debt and equity financings in the near and long term as we utilize our platform to help investors solve the housing needs of tomorrow.”

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