AB 1033: Can You Sell an ADU Separately in California?

For years, one rule set ADUs apart from other housing: you couldn't sell an ADU separately from the main house. AB 1033 (2023) created a path to change that, but only where your city or county chooses to adopt it.

What AB 1033 does

AB 1033 is now codified at Government Code section 66342 after the 2024 recodification. It authorizes, but does not require, a city or county to adopt an ordinance allowing an ADU to be sold or conveyed separately from the primary home as a condominium.

HCD's ADU Handbook confirms that this is a local opt-in. Without a local ordinance, ADUs generally can't be sold separately. The one narrow exception is Government Code section 66341, which allows separate conveyance to qualified buyers when the ADU was built by a qualified nonprofit.

Requirements when a jurisdiction opts in

The statute sets several conditions. These include:

• The property is converted to condominiums under the Davis-Stirling Common Interest Development Act. That means a recorded condominium plan and the governing documents of a common interest development.
• Lienholder consent. Every lienholder must consent in writing before the map or condo plan is recorded, and a lienholder may refuse.
• Subdivision compliance. The condos must meet the objective requirements of the Subdivision Map Act and your local subdivision ordinance.
• A safety inspection of the ADU before the condo plan is recorded. This can be a certificate of occupancy, or a housing quality standards report from a HUD-certified inspector.
• Notice to utilities. The owner must tell the water, sewer, gas and electric providers about the condo creation and the separate conveyance.
• HOA approval. In an existing planned development with an association, the condo plan needs the association's express written authorization.
• A consumer notice. Cities must print a statutory notice on ADU checklists. It warns that lenders may require a payoff, a refinance or a loan modification before they consent.

In practice, that means a condo plan, a surveyor, possibly a tentative map, a homeowners' association formed between you and your future buyer, and agreements with your lender. It's a real legal project.

Who has opted in?

Adoption has been gradual. In Southern California, the County of San Diego adopted an ordinance implementing AB 1033 for unincorporated communities. The Board of Supervisors voted on March 4, 2026, and it took effect April 4, 2026 (county page). The county provides an ADU Condo Guidance and Checklist and processes these projects through a Tentative Parcel Map or Tentative Map.

Other cities have adopted or are studying ordinances, and the list keeps changing. Check with your city planning department before assuming you can sell an ADU separately. Don't rely on third-party lists, including ours.

A realistic step-by-step

1. Confirm that your city or county has an adopted AB 1033 ordinance, and get its checklist.
2. Talk to your lender early. Without lienholder consent, nothing records.
3. Design the ADU for independent ownership: separate entrances, utilities, and clearly defined exclusive-use areas.
4. Build and final the ADU, or document a qualifying safety inspection for an existing one.
5. Have a surveyor or civil engineer prepare the map and condo plan, and an attorney draft the CC&Rs.
6. Record, notify the utilities, and market the unit.

Why it matters

• Owners can unlock equity by selling the ADU, or the main house, without selling both.
• Buyers get a lower-cost path to ownership in expensive SoCal neighborhoods.
• Builders and investors see a new product type. Note that conversion costs and HOA formation make it less attractive for small projects.

Things to weigh before you build for sale

1. Financing. Some lenders are cautious with very small condo projects, which can limit your buyers' mortgage options.
2. Property tax. Selling creates a reassessment for the conveyed unit.
3. Shared costs. Two-unit HOAs need clear agreements about roofs, yards, utilities and insurance.
4. Design. Plan separate utilities, access and private outdoor space from the start. It's expensive to retrofit.
5. Local add-ons. Cities may require extra conditions within the statute's limits.

How AB 1033 compares with SB 9

An SB 9 urban lot split creates a separate fee-simple lot, with a three-year owner-occupancy affidavit. AB 1033 creates condominium units on the same lot. See our SB 9 vs ADU guide to compare.

Owner occupancy

Under section 66315, local agencies generally can't require owner occupancy for an ADU. HCD's Handbook notes that ADUs conveyed under section 66341 are the narrow case where owner occupancy may apply. If you plan to use AB 1033, read your city's ordinance carefully for any owner or occupancy conditions.

Working with professionals

AB 1033 projects need more than a builder. You'll likely work with a real estate attorney familiar with Davis-Stirling, a licensed surveyor or civil engineer for the condo plan, and your lender. Builders in our directory who offer design-build services can often coordinate the construction side.

Bottom line

AB 1033 makes separate ADU sales possible, not automatic. In Southern California, confirm that your city or county has adopted an ordinance, budget for the condo conversion process, and talk to a real estate attorney before you design an ADU to sell.

Frequently asked questions

This page is general information, not legal, tax or financial advice. Costs vary by property and builder. Images are AI-generated illustrations. Last updated November 2026.