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Exploring California ADU Grants in 2023: Opportunities for Homeowners

In 2023, California continues to encourage the construction of Accessory Dwelling Units (ADUs) as a solution to the housing crisis. To support this initiative, various grants and financial assistance programs are available to homeowners. This blog post aims to explore the available ADU grants in California for 2023, providing valuable information for those considering adding an ADU to their property.

The ADU Grant provides up to $40,000 towards pre-development and non-reoccurring closing costs associated with the construction of the ADU.

ADU Grants

Overview of California ADU Grants in 2023

  • Purpose: Grants are designed to reduce the financial burden on homeowners and incentivize ADU construction.

  • Types of Grants: Includes funding for planning, construction, and renovation of ADUs.

Key Grant Programs and Their Benefits

Pre-Development Grant Programs:

  • Description: These grants cover the initial costs, such as design, permitting, and site assessment.

  • Examples: Local government or state-funded programs specific to pre-development stages.

Construction and Renovation Grants:

  • Details: Financial assistance for the actual construction or renovation of an ADU.

  • Availability: Offered through state housing initiatives or partnerships with housing nonprofits.

Low-Interest Loan Programs:

  • Nature: Loans with favorable terms compared to traditional financing options.

  • Benefits: Makes the ADU building process more accessible for a broader range of homeowners.

How to Apply for ADU Grants

  • Eligibility: Criteria typically include property location, homeowner’s income level, and intended use of the ADU.

  • Application Process: Steps usually involve submitting an application, providing necessary documentation, and possibly a project proposal.

The Impact of ADU Grants

  • Community Benefits: Encourages the development of affordable housing options in local communities.

  • Personal Advantages: Offers homeowners a way to increase property value and earn rental income.

The Role of the CalHFA ADU Grant Program

  • Purpose: To provide financial assistance for ADU construction, targeting low-income homeowners.

  • Aim: To increase affordable housing options in the state.

2023 Low-Income Limits (<80% AMI) for the Program

  • Effective Date: The limits, effective from November 1, 2023, dictate who can qualify based on their annual income.

  • Variation Across Counties: Income limits differ from county to county, reflecting the economic diversity of California.

A Look at Some Key Counties and Their Limits

  • Alameda and Contra Costa Counties: $126,560, reflecting the higher cost of living in these areas.

  • Los Angeles County: $84,160, accommodating the vast population and varying economic conditions.

  • Orange County: $84,160, considering its suburban demographics and living costs.

  • San Francisco and San Mateo Counties: $126,560, indicative of the high living expenses in these metropolitan areas.

  • Santa Clara County: $143,040, one of the highest in the state due to the affluent nature of the region.

How These Limits Impact Eligibility

  • Assessment: Homeowners must assess their annual income against their county’s specific limit to determine eligibility.

  • Broader Picture: These limits help ensure that the program benefits those who need it most in each locale.

Application Process and Considerations

  • Steps: Applicants should gather financial documents, understand their county’s limit, and prepare a comprehensive application.

  • Assistance: It’s advisable to seek guidance from a financial advisor or the program’s administrators for clarity.

Spotlight on Key Participating Lenders (Updated as of December 21, 2023)

American Financial Network, Inc.:

American Pacific Mortgage:

Alvarez and Garcia Group:

US Lending Company:

CMG Mortgage, Inc.:

Envoy Mortgage, LTD.:

(Include more lenders from the provided list as needed.)

ADU Grant Documents


ADU grants in California in 2023 represent a significant opportunity for homeowners to contribute to solving the housing crisis while benefiting personally. These grants not only provide financial assistance but also promote sustainable and community-oriented housing solutions.

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