With the new laws that California just passed for companion units, or more commonly known as granny flats, many are unaware of this new feature as a way of helping the statewide housing crisis.
In a statement from San Diego Mayor Kevin Faulconer, he says, “One of the fastest and least expensive ways we can increase affordable housing in San Diego is to make it easier to build granny flats. With these new incentives, we’re removing barriers to encourage the construction of new units that San Diegans can actually afford.”
So that’s what our client, Kit Gateley, did. She took advantage of this opportunity and just finished her beautiful new companion unit in the North Park area of San Diego. We talked to her and got some feedback on how the process was:
Question 1: What was the process like building your companion unit in your backyard?
“Well, it started with my friend, T, who couldn’t afford to live in San Diego anymore. And we thought, well, it would be great to build a little tiny house back here. We ended up with 435 square feet. Overall, it has been a fantastic experience with this project and it is just magical”
Question 2: How much did it cost to build your companion unit?
“The cost is ending up at just about $130,000.”
Yikes, that seems expensive!
Let’s look at how to analyze this investment and see if the numbers make sense.
Kit was able to build for just under $300/sq foot, but in her neighborhood houses sell for an average of $523/sq foot.
That means, Kit spent $130,000 but added $227,000 in value to her property.
Leaving her with $97,000 in equity.
Now that these new companion unit laws have been passed, it is very important to hire a well qualified general contractor for building these units. Kit hired Michael Doyle, who has done some small house work for Kit in the past.
We interviewed Kit’s general contractor on his view of how things went while building the companion unit:
Question 1: What was your favorite part of the whole process?
“That’s easy because working with Kit was a dream. I truly enjoy the process of construction, but having customers like her makes it even more fun! It’s great to be on the ground floor of doing something in the San Diego housing market that is economical compared to the usual ‘impossible to afford’ housing that many people face in this city. Having a support system like your website that encourages and supports customers and contractors alike.”
Question 2: What were some challenges that you faced while building the companion unit?
“Things went quite smoothly with the building process, though some things didn’t get ordered soon enough (such as kitchen cabinets) to move things along as quickly as I’d like. The drafting person specified very expensive fire rated windows that we changed to skylights, and that took him a long time to make the changes on the plans for the city in order to continue the Inspection process, thus slowing the job down.”
Question 3: How long did the process take to build a companion unit from scratch?
“I think plans and permits took approximately 3 months. Kit took care of this, using a drafting person that I recommended. I think next time I will get more involved in this part! The building process took approximately three months, also. Kit was happy about that, but I think it could’ve gone faster.”
