If you’re a homeowner or a housing policy nerd, you probably know about two of California’s most famous housing reforms in the past decade - ADU law, which lets homeowners build another small home on their lot, and SB 9, which lets homeowners build a duplex on their lot. You might even know someone who has built an ADU. But chances are you don’t know anyone who’s used SB 9.

That’s because, despite being passed after a huge fight in 2021 that generated national headlines, SB 9 has been kind of a clunker. A report by UC Berkeley’s Terner Center for Housing Innovation said SB 9’s impact in its first year, 2022, was “limited to non-existent” in the 13 cities the authors looked at. The following year, in 2023, only 110 SB 9 projects got permits to start construction in the entire state, according to a report by YIMBY Law. LA permitted three.

ADUs, on the other hand, have been popping up everywhere since the legislature started tinkering with laws governing them in 2016, with about 30,000 permitted last year:

In 2023, when LA permitted three SB 9 projects, it permitted 6,474 ADUs.

Last year, things finally started to get going for SB 9 in LA. According to the city’s annual housing report submitted to the state, over five hundred SB 9 projects got their permits last year. That’s still small potatoes compared to the 5-10,000 ADUs built each year in the city, but still it’s nice to see a law derided as “just symbolic” actually start to be used here.

I mapped the SB 9 projects permitted in the City of LA in 2024. Anything stand out to you?

92% of projects are in the Valley. That’s because lots tend to be bigger in the Valley, so a house’s backyard has more room to build. In fact, the median lot size of these projects is over 8,000 square feet.

Before I show you what people are building, let’s review what the laws allow when you have a house. With ADUs you can build a separate small house in your backyard, or an attached unit in an addition. Besides the main ADU, you can also convert an existing part of your house into a “junior ADU”, but not as an addition. So in practice, if you’re looking to leave your existing house as is and add more homes on your property, ADU law allows you to add one more home. (Also, if you have a duplex, you can add two ADUs in the back.)

Despite the popular perception of SB 9 as a duplex law, it actually offers several options to add one, two, or even three homes to your property. That’s because you can use SB 9 in combination with ADUs. You can build another full-size house in your backyard - one new home. That new backyard house can have its own ADU, attached or detached - two new homes. If you’re willing to change or add on to (or demolish) the original house, you can turn it into a duplex, and then each unit of the duplex can have its own detached ADU - three new homes. This is all without splitting the lot, a controversial provision of the law that we’ll get back to.

Looking at duplexes from spaaaaaaace

The most common type of SB9 project in LA adds a duplex in the backyard. One is technically a new single family home, and the other is its attached ADU. Here’s an example in Sherman Oaks:

The new duplex has two side-by-side units, both of which are 2-bed/2-bath. One is 850 square feet, the other 730. And they’re pretty nice.

This property is zoned for one house, and for 60 years that’s what was there. In that span of time, the neighborhood around it, also zoned for only single family homes, became insanely expensive:

This block is in a high-income neighborhood, an excellent school district, walking distance to a great park, and about a mile from the future train to UCLA. Until recently, the only way to move here was to either have a ton of money or be lucky enough to rent a house from the owner. Now the block has two more modest homes, which will likely always be for rent, attainable for many more people.

The fact that these two homes are rentals brings up a crucial difference between SB 9 and ADUs. While ADUs are often touted as a great way for homeowners to make rental income, in practice less than half of them are rented out. The rest are used as extensions of the main house, like guest houses for family or office space. That means less than half of the thousands of ADUs being built are actually contributing to the city’s housing stock. On the other hand, if a homeowner builds two homes in their backyard using SB9, at least one of those homes is almost guaranteed to be rented out. Not many families need two extra homes on their property for their own private use.

Here’s another duplex built in a backyard, this one in Koreatown:

Again, the duplex behind the original house is technically a new single family home (2-bed/2-bath) with an attached ADU (1-bed/1-bath). The new homes are more modest than the ones in Sherman Oaks, and they are more affordable too - the downstairs unit rents for $2350/month, around $300 less than the average 2-bedroom apartment in the surrounding zip code, and about what a moderate-income tenant pays for an income-restricted affordable two-bedroom apartment in LA. This is naturally occurring affordable housing, built without government funding. In the case of this duplex, it was built with government reform.

Here are some of the other things you can do using SB9:

• Convert your house with attached ADU (which used to be your garage) into a duplex so you can build another duplex (technically two ADUs) in your backyard. (2 new homes)

• Build a new house in the back, connect it to the original house with a trellis, get the city to call the two homes an attached duplex, and build two ADUs behind them. (3 new homes)

• Remodel your house, remove the attached garage and build a 1500 square foot second house next to yours. (1 new home bigger than ADU law allows)

• Convert your two-story craftsman into a duplex. (1 new home)

• Demolish your house and build a new duplex with ADU in the back. (2 new homes)

All these projects are adding more homes for rent in neighborhoods that used to allow only one house per lot - otherwise known as exclusionary zoning. Like we saw with Sherman Oaks, those neighborhoods tend to be good ones. Here’s what UC Berkeley’s Othering and Belonging Institute says about exclusionary zoning in LA:

Translation: SB 9 will give more kids a shot to have a better life than their parents.

In case you’re wondering, none of the projects I’ve mentioned uses one of the most famous provisions of SB 9 - the lot split. SB 9 allows homeowners to split their lot in two, with up to two homes allowed on each of the newly split lots. The idea is that a homeowner could sell their backyard to someone who wants to develop it, or the homeowner could develop it themselves and then sell, remaining in their original home but reaping the profits from the extra land on their property.

The problem with lot splits is that the legislature saddled them with a poison pill. If a homeowner splits their lot, they have to live on the property for three more years. They can’t sell both lots. That provision basically eliminates the ability of real estate investors to use SB 9 lot splits when flipping a house. Lot splits are also expensive, adding up to $50,000 for civil engineering work. These factors have kept lot split projects limited to non-existent in LA - of last year’s 569 projects, only four used lot splits.

Flipping the script

Wait, did I say flipping a house? Yes! SB 9 projects are often built by small real estate investors, not long-time homeowners. Developer Andrew Slocum, who has built seven SB 9 projects for investors, told me most homeowners don’t have access to the kind of funding required to build a duplex in their backyard. If you look up property records for the projects above, you’ll see the home often sold just before the SB 9 application was filed. The Koreatown home sold in May 2022, and the new owner submitted an application for the backyard duplex five weeks later. That’s the work of an investor, not a regular homeowner.

House flippers can sometimes be regarded poorly, either as gentrifiers who drive up home prices or as penny pinchers who do low-quality remodels. But as ADUs have become more popular, the business of house flipping has evolved - many flippers are now in the habit of building an ADU in the backyard of a house they are renovating in order to add value to the property. The success of ADUs is flipping flippers into builders.

SB 9 is the natural evolution of the flip + ADU play. Small real estate investors are ideally suited to build SB 9 projects. They have access to capital and experience building ADUs. Slocum has started recommending his clients use SB 9 when possible. They can buy a small house and renovate it, and then instead of building an ADU in the back, now they can build a duplex. When they sell, the new homeowner is very likely to rent out one or both of the homes in the backyard, adding more gentle density, often naturally affordable, to the housing stock in our city’s best neighborhoods. (The opposite of gentrification.) SB 9 is flipping flippers into more than just builders - they are becoming partners in addressing the housing crisis.

And flippers are great partners to have, because there are a ton of them! 20 years ago, most construction workers in LA County built new buildings, but it’s become so hard to build in LA that thousands of builders have started remodeling instead:

This is…not great! We need people to get back into building. If SB 9 convinces more remodelers to shift back to the construction business over the next few years, they could make a serious dent in the shortage of homes in our city, unlocking the most exclusive neighborhoods to more people along the way.