The City’s recent Companion Unit fee waiver is a major mile-marker for housing in San Diego.  

Companion Units, also known as Accessory Dwelling Units or granny flats, are now allowed in almost every residential community throughout the city.   And we’re not talking about some small 200 square foot studio apartment.  Companion units can be up to 1,200 square feet, have a full kitchen, several bedrooms and bathrooms, can extend into side and year yard setbacks, and at times, be exempt from requiring additional parking.  Developers and homeowners should now ask whether a property zoned for a duplex can really be a triplex, or a single-family property a duplex.

In the past, there were various conditions and fees that made the construction of a companion unit infeasible for most.  For example, at one point, to get approval to construct a companion unit, the property owner was required to record a covenant on title agreeing to never rent out the unit.  Moreover, there could be over $30,000 in regulatory fees to permit a companion unit! This has all changed.  For new companion units, the deed restriction is no longer required and the constructed unit can now be rented.  On April 30, 2018, the City Council passed an ordinance to exempt companion units from impact fees and adopted a resolution to waive water, sewer, General Plan, and possibly even traffic fees. This fee waiver can save those planning to construct a companion unit over $30,000 in regulatory fees.  

Some are concerned that companion units will decrease property values because of a loss of a single-family feel and neighborhood stability, parking shortages, and traffic congestion.  However, the benefits of increased housing stock, increased transit ridership, extra income for homeowners, and added lifestyle flexibility for second generation living far outweigh the negatives.  

This will be an important topic to watch as the City continues to grapple with short term rental obligations and how companion units will be impacted.  But, for the time being, the City requires that companion units not be rented for a term of less than 30 days. 

By Stephanie V.F. Smith

Stephanie is a Land Use and CEQA attorney at Grid Legal specializing in matters in Southern California.
https://www.gridlegal.com/about/about-stephanie-smith