‘Granny flats’ finding a home in tight market

"Granny flats" and "in-law-suites," small apartments in garages, basements and backyard cottages, are making a comeback in areas where housing is expensive and land to build it on is scarce.

By Haya El Nasser, USA TODAY

http://www.usatoday.com/news/nation/2004-01-05-granny-flats_x.htm

Cities and states from California to Massachusetts are rewriting zoning laws to let homeowners build second housing units on single-family lots. Proponents say legalizing small apartments in residential neighborhoods is a fast and cheap way to create rental housing that students, workers and the elderly can afford.

But many homeowners are not happy about the prospect of renters living next door. "None of us want our neighborhoods destroyed," says Karen Klinger, a real estate broker in Arden Park, Calif., near Sacramento. "There should be some restrictions so that our neighborhoods don’t turn into multifamily neighborhoods."

Relaxing zoning codes

California is leading the pack with a new law that effectively forces cities to relax zoning codes and make it easier to get building permits for such rental units. Cities can’t ban granny flats, and homeowners no longer have to face angry neighbors at public hearings.

"What has really caused a resurgence is the combination of the affordable housing crisis and increasing concerns over sprawl," says Cathy Creswell, deputy director of the California Department of Housing and Community Development.

California, which is adding about 500,000 residents a year, is in the thick of a housing shortage. Housing prices there are among the highest in the nation. But many communities continue to resist developments such as apartments and townhouses, preferring single-family homes.

Housing in many parts of California and elsewhere has become so expensive that employers can’t attract workers and retain college graduates. The elderly often can’t afford to live near children and grandchildren. Some cities are building housing for teachers and police officers, who often can’t afford to live where they serve.

Officially known as accessory dwelling units, granny flats are attached to the main house or a separate building on the same lot. They were a tradition before the 1950s, when many extended families lived together. Aging parents lived in the small units, which were quickly dubbed granny flats or in-law suites. In wealthy neighborhoods, owners often set up separate living quarters for chauffeurs and maids.

This housing style faded when homeowners flocked to the suburbs to escape crowding. Cities clamped down on apartments in single-family neighborhoods. Many banned them outright.

Now, there’s a revival.

"It’s a viable and important source of affordable housing that even a wealthy community can benefit from," says Deborah Howe, professor of urban studies and planning at Portland (Ore.) State University. The movement is gaining momentum in:

• The Boston area, where the median sale price of an existing single-family home rose well above $400,000 this year. Despite losing 200,000 people and gaining 30,000 housing units since 1950, Boston has a severe housing shortage.

"Families and households are taking up far more space than they used to," says Paul Grogan of the Boston Foundation, a community group. In 1950, an average of 3.37 people lived in each household in Boston, he says. It has dropped to 2.31.

• Cary, N.C., a fast-growing city outside Raleigh. Cary five years ago began allowing "utility dwelling units" in single-family homes. As of this year, homeowners can build an apartment next to their homes, but only in the downtown area.

"We don’t have restrictions as to who lives there as long as it meets the standards," says Ricky Barker, the city’s associate planning director. "It benefits the homeowners and our vision of getting more people in the downtown area."

• Washington state, where cities that have more than 20,000 people must allow second living units in any neighborhood. In Seattle, a local housing coalition launched an initiative to educate communities about the benefits of granny flats.

• Chicago, where the Metropolitan Planning Council is pushing the city to allow apartments in coach houses. Originally designed for horses, carriages and drivers, many were turned into garages and small apartments. The city banned new apartments in coach houses in the 1950s.

But support for granny flats isn’t universal. The League of California Cities is fighting the new state law that makes it harder to block such units. "We object to the (state’s) intrusion into local land-use decisions," says Jessica Mullan, policy analyst for the group. "You have a neighborhood that’s zoned for single-family homes, and you’re basically changing the character of that community without any input from the community."

Sandi Monda, 58, of Torrance, Calif., says "granny flat" is a misnomer. Supporters of the practice, she says, "use it to get sympathy. The homes we’re living in are selling for anywhere between $500,000 to $700,000. If a homeowner chooses to put a granny flat on their property, I can assure you it’s not going to be affordable."

Santa Cruz, Calif., is offering incentives to homeowners who build second units and charge rents that a person making 80% of the median monthly income in the town could afford. That means rent of about $1,200 a month for a two-person household. For homeowners building such units, permit fees of up to $6,000 are waived. The city, which has some of California’s highest housing prices, posts seven architectural blueprints for granny flats on its Web site. Permits tripled from 10 in 2002 to 30 in 2003.

Building a ‘sonny flat’

Tori Milburn of Santa Cruz is spending more than $30,000 to convert her garage into a "sonny flat." Her three-bedroom home is getting too small for her bookkeeping business and two teenage sons. She uses the garage for storage now. Soon, it will be a 400-square-foot studio apartment for Kyle, 17. "When my son moves away, I would have a unit that I could rent out to supplement my income," says Milburn, 41 and divorced. Going price: $800 to $1,200 a month.

San Jose, Calif., Councilman Chuck Reed sees great benefits. More units generate more property tax revenue because of higher assessments on homes with apartments. Such units also save local governments the $100,000 average cost of building one affordable housing unit.

"If we can build a thousand of those things, that would save us $100 million in government subsidies," Reed says.