Call them granny flats, accessory dwelling units or sheds, but small backyard structures are popping up out West. CNBC's Diana Olick reports:
Second homes, formally called accessory dwelling units (ADUs), are cropping up in back and side yards across America, acting as either rental units or additional space for aging parents and still-nested adult children.
Growth in the sector has been fueled by changes to local and state zoning rules. Some municipalities are struggling with a lack of affordable housing and see these additional units as one remedy.
In 2010 Portland, Oregon, waived impact fees for ADUs, making them significantly less expensive. As a result, the number of ADU permits jumped from 86 in 2010 to 660 in 2018, according to a count by accessorydwellings.org.
In California, when a 2017 state law forced cities to relax ADU regulations, permits jumped even more dramatically.
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