Connect with us

Lifestyle

Unlocking California’s Housing Gold: AB1033 and SB9 Offer New Avenues for Homeowners to Tap Equity

mm

Published

on

In the golden state of California, homeowners now have the opportunity to unlock a wellspring of home equity through two groundbreaking pieces of legislation: Assembly Bill 1033 (AB1033) and Senate Bill 9 (SB9). These laws are not only reshaping the real estate landscape, but also providing homeowners with innovative means to capitalize on their most valuable asset: their homes.

Governor Newsom recently signed AB1033 into law, marking a significant milestone in California’s housing evolution. This legislation enables owners of single-family homes in the state to not only build Accessory Dwelling Units (ADUs) in their yards, but also to subdivide their properties into two condominiums. “This game-changing move,” notes Matt Lucido, founder and CEO of Yardsworth, “permits homeowners to sell off the ADUs, effectively tapping into the value hidden within their yards for decades due to restrictive zoning laws.”

AB1033: The condominium option

The core feature of AB1033 is its allowance for homeowners to not only construct ADUs in their yards, but also subdivide their lots into separate units — each designated as a condominium. The revolutionary aspect of this is that homeowners can independently sell the ADU, presenting an innovative approach to utilizing home equity that deviates from traditional methods like selling and moving, or borrowing against one’s home with second mortgages or cash-out refinancing. These conventional avenues typically involve high interest rates and the potential for displacement from one’s neighborhood, making AB1033 a refreshing and much-needed alternative.

“Historically, there were only two ways for a homeowner to tap into the equity of their homes. One, by selling and moving, but that’s not a great option with today’s interest rates; or two, borrowing against their home with a second mortgage or cash-out refinance — which is also untenable with today’s interest rates,” Matt Lucido shares.

However, it’s crucial to recognize that AB1033 primarily benefits homeowners who already possess ADUs. For those seeking to sell a portion of their yard and access the opportunity without pre-existing ADUs, SB9 remains the best option. Additionally, AB1033’s full potential hinges on its implementation by local municipalities, which may vary across the state. This means that the extent to which homeowners can benefit from AB1033 depends on the discretion of local authorities.

SB9: A state-wide mandate

SB9 focuses primarily on allowing the subdivision of single-family lots into two separate units, and facilitates the construction of additional dwelling units. The essence of SB9 lies in its potential to expand housing options, while allowing homeowners to tap into the previously dormant value within their properties.

SB9’s provisions are designed to address some of the persistent challenges associated with housing in California. It permits the subdivision of single-family lots, creating opportunities for the construction of up to two additional units, whether in the form of ADUs, or even a new house or duplex. This not only encourages greater housing density, but also allows homeowners to maximize the use of their land, thereby capitalizing on their home equity without selling their homes or incurring high-interest mortgage debt.

Implementation challenges

While AB1033 and SB9 offer promising avenues for homeowners to tap into their property’s hidden value, several challenges and uncertainties must be considered in the implementation of these legislative measures.

AB1033, for example, has additional costs other than those associated with lot subdivision and construction. Homeowners opting for this route will also need to pay for legal counsel to establish a Homeowners Association (HOA) for the newly created two-unit condominium. Operating and maintaining such an association in the years to come adds complexity and expense to the overall expense, making AB1033 a potentially costly option compared to SB9.

Under SB9, the cost of subdividing a lot can range from $50,000 to $75,000. These expenses primarily arise from the need to create a new parcel map compliant with the Subdivision Map Act, city fees, and the involvement of consultants and surveyors. These costs can be prohibitively high for many homeowners, potentially limiting the accessibility of these opportunities. Companies like Yardsworth have stepped in to mitigate this challenge by covering all these fees and expenses for their SB9 clients, making it a more financially viable option.

Furthermore, AB1033 is not yet fully implemented, and its uniform application across California remains uncertain. Municipalities possess significant discretion when it comes to adopting and implementing the provisions of AB1033. Consequently, the extent to which homeowners can leverage this law may vary greatly depending on their location. In contrast, SB9 is a state-wide mandate, ensuring consistent implementation across all municipalities, making it a more dependable option for homeowners.

California’s housing crisis and unlocking home equity

“California homeowners are still sitting on near-record home equity,” Matt Lucido points out.  “The value of California homes has more than doubled in the last 10 years.”

The confluence of AB1033 and SB9 takes on added significance in light of California’s pressing housing crisis. Governor Newsom has persistently underscored the state’s need for 3.5 million new homes by 2025. These legislative measures, AB1033 and SB9, represent significant steps toward addressing this crisis. They offer pathways to unlock the latent potential within California’s housing market. They provide homeowners with innovative ways to access their home equity without the need to sell their homes, a practice often linked with gentrification-related displacement.

One of the central challenges in California has been the spiraling cost of homeownership. Today’s 20-year-high interest rates only make buying a home (or selling, moving, and rebuying) more expensive. As a result, homeowners are staying put in their homes, with no viable way of accessing their home equity. It is essential to find ways to access this wealth without resorting to high-interest borrowing, such as Home Equity Lines of Credit (HELOC), with rates as high as 10 percent or more. This is where AB1033 and SB9 emerge as compelling alternatives. These laws facilitate homeowners in staying in their homes and neighborhoods while selling a portion of their property, thus allowing them to access their home equity without incurring considerable financial burdens.

The new California laws AB1033 and SB9 offer innovative solutions to unlock home equity for homeowners in the state. By permitting the subdivision of single-family lots and the construction of ADUs that can be sold independently, these legislations allow homeowners to tap into the dormant value within their properties. This not only provides a pathway to access much-needed funds without displacement, but also encourages housing density to help alleviate California’s crisis. However, potential barriers like municipal discretion over AB1033 implementation and high subdivision costs associated with SB9 must be addressed to ensure these laws fully deliver on their promise.

Overall, AB1033 and SB9 represent promising steps in the right direction to empower homeowners, stimulate housing growth, and inject liquidity into the state’s housing market. While uncertainties remain, their passage indicates California’s commitment to pursuing creative approaches that benefit both homeowners and the broader community.

Rosario is from New York and has worked with leading companies like Microsoft as a copy-writer in the past. Now he spends his time writing for readers of BigtimeDaily.com

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Lifestyle

Flavored Nut Butters: A Twist on Classic Nut Butters with Unique Tastes

mm

Published

on

Nut butters have long been a staple snack, valued for their versatility and nutritional benefits. Yet traditional options often lack the excitement that modern consumers seek. American Dream Nut Butter has reinvented this classic, offering flavored nut butters that combine indulgence with health consciousness. From peanut-free nut butters to all nut butter varieties, this family-owned, female-founded business has shaken up nutritional snack options.

Innovative Flavored Nut Butter, Unmatched Quality

American Dream Nut Butter specializes in small-batch, hand-whipped nut butters that cater to diverse dietary needs. Using only premium ingredients, each jar boasts a signature drippy texture and indulgent flavors. Popular options like Peanut Butter Lovers and Almond Butter Bliss appeal to both health enthusiasts and flavor seekers. These nutty butters are low carb, high-protein, and free of artificial sweeteners, ensuring a nutritious yet satisfying treat.

Their full collection of nut butters includes various flavored nut butter options designed for every palate. Their peanut-free nut butters provide safe alternatives for those with allergies, proving that no one has to miss out on the fun of these creative spreads.

Nutty Butter: Beyond Traditional Spreads

American Dream Nut Butter’s commitment to innovation goes beyond flavor. These products are perfect for enhancing meals, snacks, and desserts. Use their nut butter in smoothies, baked goods, or simply as a toast topping. They even provide options like cashew butter to add plant-based protein to your diet (learn more here).

Unlike competitors, this brand maintains complete control over quality by producing all jars in-house, ensuring consistency and care in every batch. Whether you’re exploring classic flavors or unique combinations, these nut butters offer an indulgent yet wholesome snacking experience.

A Nutbutter Mission Rooted in Purpose

What sets American Dream Nut Butter apart isn’t just the quality of their products, but the story behind their creation. Inspired by the need to overcome food intolerances, the founder prioritizes inclusivity and flavor. This ethos extends to their Hero program, which donates a portion of proceeds to military members and first responders, giving back to the community while delivering exceptional products.

For an indulgent twist on tradition, their peanut butter nuts provide a rich and creamy texture that transforms any recipe into a gourmet delight. Their flavored nut butter highlights the brand’s versatility, allowing you to experiment with flavors that go beyond conventional spreads.

Discover American Dream Nut Butter’s Flavored Nut Butter

With a commitment to craftsmanship and community, American Dream Nut Butter has reimagined the possibilities of nut butters. Whether you’re looking for peanut-free nut butters or a flavorful meal addition, this brand delivers.

Ready to taste the difference? Explore their flavored nut butter collections and almond butter varieties. Join the growing community of fans who have made American Dream Nut Butter a staple in their kitchens and discover your next favorite spread.

*Images sourced from American Dream Nut Butter

Continue Reading

Trending