The document proposes a housing solution to address Los Angeles County's shortage of affordable housing. It recommends promoting the construction of Accessory Dwelling Units (ADUs) or "granny flats" throughout residential areas. The proposal suggests offering tax incentives to homeowners to build ADUs, establishing a "one-stop-shop" to streamline the approval process, and encouraging more affordable construction methods like prefabrication to lower costs. It argues that increasing the supply of ADUs in this way could significantly contribute to alleviating the region's housing crisis by providing affordable rental options.

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From: Alma Castro, Denise Lopez, Elizabeth Cline, Kelly Redmond, and Nicolas Rodriquez
Advisor: Professor Robert Suro
To: Southern California Symposium
Group 4 Proposal: What if Los Angeles County? A Housing Proposal
A. Introduction
1. The Region:
a. Los Angeles County is a fast-growing region and is the largest county by
population in the United States. With 88 cities, the County is home to over
10 million people who speak over 220 languages.
i. Of that population roughly 35% of Los Angeles County residents
are foreign born. The region is a leader in the creative economy; it
has one of the nation’s largest manufacturing bases and one of its
largest international trade centers.
2. The Problem:
a. As the region has grown in population, the supply of housing has not,
leading to an unprecedented housing crisis. In addition, incomes have
been stagnant and have not kept pace with the increased cost of living.
i. According to a 2017 National Low Income Housing Coalitioni
report, the inflation-adjusted median rent for Los Angeles County
between 2000-2015 increased by 32 percent, while median tenant
income dropped by 3 percent.
b. While cities and the County of Los Angeles have worked to speed up the
development of multi-family and single-family housing our region still
needs over 500,000 new affordable housing units to meet the needs of
residents right now.ii
c. In the meantime the cost of housing has risen in the region, averaging
36.2% of a person’s yearly expenditures during a year.iii
i. This amount is more than the 32% national average and also more
than the federal housing standard of paying no more than 30% of a
person’s adjusted income for housing.iv
d. Over 54% of renters in California pay more than 30% of their income to
housing and nearly 30% of renters pay over 50% of their income to
housing.v
B. Our Goal
3. Our North Star (Goal):
a. In order to make Los Angeles affordable again for all its residents we
envision a Los Angeles County where no one has to pay more than 27% of
their income towards housing costs.
C. Our Solution
4. Our Recommendation:
a. In a nutshell - we propose rethinking Accessory Dwelling Units (ADU),
viewing them as possible housing solutions for quick, low-cost, permanent
housing, as a way to help alleviate the region’s housing crisis.
i. While cities, the County and actors in government and the private
sector tackle housing development, our idea addresses a new and

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vastly underutilized solution to alleviate the housing crisis by
encouraging the construction of these units in residential areas
throughout the region.
b. Accessory Dwelling Units, also known as “granny flats,” can take
underutilized backyards or adjoining lots and turn them into the location
for a new single or multi-family housing structure.
i. This is an opportunity for homeowners to elevate their community
while taking control of their livelihood and actively play a role in
solving one of the region’s most pressing issues -- and the answer
is RIGHT IN THEIR BACKYARD.
5. How Our Recommendation Works:
a. With housing, construction costs are often driven by scale and
development costs. With financing and improved local regulations, we
could provide a streamlined path and financial incentives that would
encourage construction of ADUs throughout Los Angeles County.vi
i. Building ADUs as affordable housing units on various properties
throughout the region could provide a source of income to
homeowners as well as a source of affordable housing to tenants.
b. We would encourage single-family and multi-family home property
owners who own sufficient available property to build ADUs on their land
by offering them tax incentives.
i. By providing a rebate on either their state income taxes or property
taxes, we could help to ease the cost of housing construction to
property owners.
c. While housing construction happens more often in dense urban centers
and along transit corridors, the construction of ADUs would be
encouraged in areas that are already built out: residential communities that
have seen less development or change in the recent past.
i. The Southern California Association of Governments reported that
the multi-family construction permits outpace single-family
housing permits.vii
ii. Building ADUs could encourage more housing developments in
the backyards of already constructed homes, locations that have
seen less housing changes.
iii. It opens up the landscape on how much developable land exists in
region.
d. In order to ease the process for homeowners wishing to plan, permit and
construct homes on their properties, we would encourage the creation of a
“One-Stop-Shop” for improving the review, permitting and approval
process to speed up development.
i. The “One-Stop-Shop” would serve as a bridge between cities,
unincorporated areas, the County and the homeowner providing a
location for the person to submit their plans, finalize construction
and would offer key services:
1. Technical guidance and counseling.
2. Plan review and permitting.

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3. Financial guidance.
4. Construction review.
e. We would encourage the implementation of more sustainable housing
solutions such as prefabricated and modular buildings and 3D-printed
homes to substantially lower the cost of construction as well as the cost of
maintenance.
i. Prefabricated and modular materials have been viewed as cheaper
alternatives to constructing homes, lowering the traditionally high
costs of housing construction.viii
1. A program to encourage the use of these forms of
construction, or the use of 3D-printed homes in
constructing ADUs could substantially lower the cost of
construction to homeowners as well as speed the process of
construction to move tenants into homes is less time.
ii. These construction methods could also encourage the use of more
sustainable and energy-efficient materials to lower energy costs
and waste by residents.
6. Why Our Recommendation Works:
a. Our proposal makes it easier for all parties involved to address the issue of
creating more affordable housing:
i. We bring the solution to trusted individual and smaller nonprofit
developers who have been creatively contributing to affordable
housing stock in Los Angeles County.
b. Our proposal transfers the power back to neighbors and neighborhoods to
develop housing solutions.
i. The proposal allows the homeowner to lead the creation of the
future stock of housing.
c. Money to stays in the neighborhood, in turn strengthening and
empowering the local economy.
d. Changing the rules: We envision the future of Los Angeles County urban
neighborhoods as better integrated communities, like small towns with
multi-generational family settings.
i. Neighbors can look out for each other, grow and prosper.
ii. It will no longer be just large developers deciding who lives in all
neighborhoods.
e. Diversify housing options:
i. There will be a multitude of diverse housing options beyond
traditional apartments and single-family homes.
ii. New construction would allow for a housing evolution in
communities with traditionally static housing options and could
open the door for further housing changes in the future as
homeowners buy in to the new model.
f. Tremendous savings passed on to the renter:
i. By utilizing new construction methods and materials that lower
costs, such as prefabricated or modular housing, we could lower

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construction costs that can lower the burden of cost to the
homeowner and renter.
1. New construction technology is ready for use and can drive
the costs of developing granny flats down through
prefabrication and other methods
g. We can better integrate the social and cultural fabric of neighborhoods:
i. Families can age in place.
1. The homeowner who builds an ADU in their backyard can
rent it out to earn income and help pay for the mortgage
and property taxes on their home.
2. The homeowner could also move from their current home
into the ADU and rent out their home to increase their
rental income.
3. A homeowner could move in an elderly family member to
help maintain care for that person as they age.
h. Having every homeowner who is eligible to build an ADU build one can
vastly increase the available developable land:
i. The “One-Stop-Shop” for development of ADUs can make it
easier for homeowners to navigate the development process and
create new emerging markets for housing development.
7. A Paradigm Shift In Housing in Los Angeles
a. In order to address this crisis and the changing landscape of Los Angeles
County, we also need a shift in our thinking about what housing is the
region.
i. For the region to thrive, to respond to the real needs of its
residents, the future will be increased density and diversification of
housing stock.
ii. The region still has a significant amount of unused space
1. In Los Angeles, 28 percent of multifamily parcels are
underutilized, potentially adding 306,000 units under
current zoning—a 9 percent increase over the city’s 3.3
million existing units”ix
b. The program for developing ADUs as a key housing source in residential
areas could be an opportunity to rethink what an ideal home could look
like in the future:
i. The City of Los Angeles appointed a “Design Czar,” when Mayor
Eric Garcetti hired Los Angeles Times architecture critic,
Christopher Hawthorne.
1. Hawthorne is tasked with rethinking housing design in Los
Angeles to ensure that when Los Angeles builds he can
insure that housing design is innovative.
2. Construction of ADUs could be an opportunity to utilize
innovative designs for prefabricated and modular housing
construction, creating a “Craftsman” home for the 21st
Century while still incorporating aspects of the
neighborhoods’ character.

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8. Remaining Challenges
a. Accessory Dwelling Units are not a panacea for the housing affordability
crisis.
i. Multi-family housing options and single-family homes will
continue to play a critical role in communities.
ii. Denser housing along transit corridors and business centers will
allow for a significant growth in housing stock and affordability on
a large scale.
b. ADUs are not a solution that every homeowner will agree to.
i. Not every homeowner or neighborhood will look at the granny flat
as a preferred housing solution.
c. Encouraging the use of prefabricated and modular building construction
will continue to be a challenge.
i. Changing perception of the quality of these types of structures will
be a challenge that must be overcome by convincing homeowners
about the cost-effective and sustainable benefits of prefabricated or
repurposed materials that can lower housing and energy costs.
d. Allowing flexibility to renters and owners to generate income for short-
term subletting of their rental units and houses may be a challenge to
keeping these buildings available for long-term rental.
9. Conclusion
a. The Accessory Dwelling Unit can be a critical tool for addressing the
housing affordability crisis in Los Angeles County.
b. By lowering the barriers of entry and incentivizing their construction,
ADUs can turn the proverbial backyards of many homeowners into a
significant part of the housing solution in the region.
i. By increasing supply and targeting these granny flats as affordable
dwellings for renters, it can provide good source of housing for
renting families.
ii. By providing renters with an affordable source of housing it will
also have the impact of supporting the housing costs of property
owners.
iii. It will enable some property owners as well to better age in place
as it will offer them a source of financial security both in the short
and long term.
iv. It allows the region to innovate by creating new types of housing
using sustainable practices and materials that can significantly
lower the barriers of entry and can be translated to lower rents for
tenant families.
c. It is clear that while the ADU is not the one solution to the housing supply
and affordability crisis, it can be a vital option for encouraging grassroots
housing development.

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i
Aurand, Andrew, et al. “Out of Reach: California.” National Low Income Housing Coalition, 4 June 2017,
https://nlihc.org/oor/california. The data in this annual study housing affordability, and compares every
state’s local housing wage, and hourly wage required to afford a modest, two-bedroom rental home.
ii
Aurand, Andrew, et al. “The Gap: A Shortage of Affordable Homes.” National Low Income Housing
Coalition, 1 March 2018, https://nlihc.org/gap/2016/ca. The report notes the widespread shortage of
affordable housing, and measures the availability of rental housing affordable to extremely low income
households and other income groups, across the country.
iii
“Los Angeles Area Economic Summary.” Bureau of Labor Statistics, 2 May 2018,
https://www.bls.gov/regions/west/summary/blssummary_losangeles.pdf. This summary presents a
sampling of economic information for the area; subjects include unemployment, employment, wages,
prices, spending, and benefits.
iv
“Consumer Expenditures for the Los Angeles Area: 2015-16.” Bureau of Labor Statistics, 7 December
2017, https://www.bls.gov/regions/west/news-release/consumerexpenditures_losangeles.htm. Data in this
release are from the Consumer Expenditure Survey (CE), which the U.S. Census Bureau conducts for the
U.S. Bureau of Labor Statistics and highlights the Los Angeles area’s 2015–16 spending patterns.
“HUD's Public Housing Program.” HUD.gov / U.S. Department of Housing and Urban Development
(HUD), 31 May 2018, www.hud.gov/topics/rental_assistance/phprog. This online fact sheet describes
HUD’s public housing program in details, offering an at-a-glance list on such questions as, who is eligible
and how one can apply, how rent is determined among other important questions for renters.
v
Kimberlin, Sara. “Californians in All Parts of the State Pay More Than They Can Afford for Housing.”
California Budget & Policy Center, 12 Sept. 2017, calbudgetcenter.org/resources/californians-parts-state-
pay-can-afford-housing/. This fact sheet lays out California’s housing crisis by comparing costs relative to
incomes.
v i
Jakabovics, Andrew, et al. “Bending the Cost Curve: Solutions to Expand the Supply of Affordable
Rentals.” Washington, DC: Urban Land Institute, 2014. http://uli.org/wp-content/uploads/ULI-
Documents/BendingCostCurve-Solutions_2014_web.pdf. This report addresses the issues of what drives
costs and why, providing more detail on the cost drivers, including how those drivers vary by market,
along with the recommended actions.
v ii
“Profile of Los Angeles County.” Southern California Association of Governments, 1 May 2017,
www.scag.ca.gov/Documents/LosAngelesCountyLP.pdf. The Local Profiles reports provide a variety of
demographic, economic, education, housing, and transportation information about each member city and
county.

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Azari, Rahman. “Modular Prefabricated Residential Construction: Constraints and Opportunities.” Pacific
Northwest Center for Construction Research and Education, University of Washington, Skanska
Innovation Grant, 1 Aug. 2013, cm.be.washington.edu/wp-content/uploads/2016/07/pub_modprefab_-
Skanska_08082013_web.pdf. The key objective of this report is to provide a review of the potential for
modular prefabricated construction for mid- to high-rise residential buildings in the city of Seattle.The
report highlights the great potential that there exists for modular construction in the creation of high-rise
residential buildings.
v iii
Lopez, Diana, et al. “Analysis of Costs and Benefits of Panelized and Modular Prefabricated Homes.”
Science Direct, Elsevier, 20 May 2016, www.sciencedirect.com/science/article/pii/S1877705816301734.
This study presents a comprehensive analysis of the costs and benefits of the two main construction
methods in the prefabricated homes category: panelized and modular.
ix
Woetzel, Jonathan. “Closing California's Housing Gap.” McKinsey & Company, 1 Oct. 2016,
www.mckinsey.com/featured-insights/urbanization/closing-californias-housing-gap. The report provides a
tool kit for fixing a chronic housing shortage in California's major cities and rural communities.