AB 1033 California — Selling an ADU Separately Under the 2024 Condominium Law (2026 Guide)

AB 1033 has been California law since January 1, 2024 — but for the first 18 months, no California homeowner could actually use it to sell an ADU separately from the primary house. San Jose closed the first AB 1033 condominium transactions in August 2025, becoming the first city in the state to complete implementation.

As of April 2026, three California jurisdictions have opted in: San Jose, Santa Monica, and unincorporated San Diego County. Every other city and county in California still prohibits the separate sale of an ADU under default state law. This guide explains what AB 1033 does, how the condominium conversion process works, which jurisdictions have adopted it, and what the law does not change. You can also check any California contractor license instantly before hiring a builder for an ADU project in any jurisdiction.

AB 1033 is a California state law authored by Assemblymember Phil Ting of San Francisco. Governor Newsom signed the bill on October 11, 2023, and it took effect January 1, 2024. The bill amends Government Code Section 65852.2 and adds Section 65852.26, creating a legal framework for the separate sale of accessory dwelling units.

Before AB 1033 California law required ADUs and primary dwellings on a single parcel to remain under common ownership. An ADU could not be deeded to a separate buyer without going through a full lot subdivision — a process that was prohibitively expensive and legally complex for most single-family properties. AB 1033 created a targeted pathway using condominium structure under the Davis-Stirling Common Interest Development Act.

The bill is explicitly local-option. Cities and counties must affirmatively adopt AB 1033 through their own local ordinance. Without that ordinance, the law does nothing in that jurisdiction and default California rules still apply.

This structure was a political compromise. Opposition from city governments concerned about neighborhood density, parking, and long-term character pushed the final bill toward the opt-in model. The practical effect in 2026 is a patchwork — most California jurisdictions have not adopted AB 1033 and separate ADU sales remain unavailable there.

Before AB 1033, state ADU law — codified primarily in Government Code 65852.2 — allowed local jurisdictions to permit ADUs on single-family-zoned lots but required those units to be rented or occupied by family, not sold. The ADU and primary dwelling had to stay under common ownership.

That restriction was a hard constraint on ADU financing and equity. Because the ADU could not be transferred independently, lenders underwrote ADU construction as an addition to the main house rather than as a separate asset. Rental income could support the loan, but the ADU itself had no separate exit value for the homeowner.

AB 1033 ADU law changed the default. The new Government Code Section 65852.26 lets cities pass ordinances allowing condominium conversion of an ADU, at which point the ADU becomes a separately transferable real estate asset. The primary dwelling and the ADU are both condominium units of a two-unit or multi-unit common interest development under California’s Davis-Stirling Act.

The shift is legal, not zoning. The underlying ADU still has to comply with all local zoning rules for setbacks, height, size, parking, and utility connections. AB 1033 does not create new ADU types or loosen construction standards — it changes what can happen to an existing ADU after it is built and inspected.

As of April 2026, three California jurisdictions have adopted AB 1033 ordinances that are currently in effect:

• San Jose — the first city in California to adopt and implement AB 1033. San Jose’s first AB 1033 condominium conversions closed in August 2025.
• Santa Monica — opted into AB 1033 in early 2025 with specific local conditions attached to its ordinance.
• San Diego County (unincorporated areas) — the Board of Supervisors voted to adopt AB 1033 on March 4, 2026. The ordinance took effect April 4, 2026.

Several other California jurisdictions have studied AB 1033 without adopting. As of March 2026, neither the City of Los Angeles nor unincorporated Los Angeles County had adopted an AB 1033 ordinance. Sacramento, Oakland, and Long Beach are among the cities that have initiated study periods or public comment processes without final action.

Adoption status changes jurisdiction by jurisdiction and month by month. To sell ADU separately California law requires the property to sit inside an opted-in jurisdiction — a homeowner considering an ADU condominiumization California process should confirm current local status with the planning department before beginning any project premised on a separate sale. Do not rely on third-party lists — including this one — as proof of current eligibility. Verify directly with the local planning desk.

The absence of an AB 1033 ordinance in a given city is not necessarily permanent, but it is the current condition. Building an ADU today in a non-adopting city with the expectation that the city will later opt in is speculative.

In a jurisdiction that has adopted AB 1033, the process to sell an ADU separately involves converting the property into a common interest development under the Davis-Stirling Common Interest Development Act. The core requirements are defined in Government Code Section 65852.26 and referenced provisions of the Subdivision Map Act.

1. Local planning approval. The homeowner applies under the jurisdiction’s AB 1033 ordinance. Each adopting city has its own filing requirements, fees, and review timeline.
2. Separate utility connections. Water, sewer, gas, and electricity must be split so the ADU and primary dwelling each have independent metered service. This typically requires utility upgrades if the ADU was built on shared services.
3. Safety inspection. A final inspection confirms the ADU meets building and safety standards and is habitable. The inspection precedes recording of the condominium plan.
4. Condominium plan recording. A condominium plan prepared by a licensed civil engineer or land surveyor is recorded with the county. The plan defines the boundaries of each condominium unit and the shared common areas.
5. Davis-Stirling compliance. The property becomes a common interest development. CC&Rs must be drafted and recorded, a homeowners association created (even for two units), and required disclosures provided to future buyers.
6. Separate deed and title. Once the condominium plan is recorded, the ADU has a separate parcel identification and can be sold, deeded, and financed independently.

The total timeline for an ADU condo conversion California process varies by jurisdiction. San Jose’s early cases reportedly ran six to nine months from planning application to recorded condominium plan. Costs for surveys, engineering, utility splits, and legal work typically run into the tens of thousands of dollars, with the range varying based on property conditions.

Homeowners starting this process should work with a contractor experienced in California ADU construction and local code compliance. Before hiring, verify the contractor’s CSLB record using our how to check a contractor license in California guide.

AB 1033 was designed to expand homeownership access in California’s high-cost housing markets by creating new for-sale inventory at price points below a full single-family home. The clearest beneficiaries fall into specific categories.

Homeowners who want to extract equity from an ADU without selling their primary home. Under pre-AB 1033 rules, an owner who had invested hundreds of thousands in an ADU could only access that value through refinance or rental income. AB 1033 creates a new exit for homeowners in participating jurisdictions.

First-time buyers priced out of full single-family homes. A standalone ADU sold as a condominium typically trades at a fraction of the price of a full house in the same neighborhood. In cities where median home prices exceed $1 million, an ADU condominium opens a lower rung on the ownership ladder.

Family members looking to own, not inherit. Multi-generational households that built an ADU for an adult child or aging parent now have a legal path to transfer ownership rather than simply grant occupancy. Estate, tax, and mortgage implications should be reviewed with an attorney and tax advisor before proceeding.

ADU developers and builders in opted-in jurisdictions. Builders operating in San Jose, Santa Monica, and unincorporated San Diego County can now market new ADU projects with a potential separate-sale exit, which changes the financing math and can improve project returns. In non-adopting California cities, the business case for ADUs remains rental-based.

Browse ADU builders in Sacramento, ADU builders in Los Angeles, ADU builders in San Diego, or ADU builders in the SF Bay Area — every builder listed has been CSLB-verified and is monitored every 12 hours.

AB 1033 is narrower than most headlines suggest. Several limitations apply even in adopting jurisdictions, and understanding them prevents expensive missteps.

It does not override local zoning. The underlying ADU must still comply with every applicable local zoning requirement for setbacks, height, parking, size, and utility capacity. AB 1033 changes ownership structure, not building standards.

It does not apply automatically. Absent a local ordinance, AB 1033 has no effect. A homeowner in a non-adopting California city cannot force condominiumization by citing the state statute alone.

It does not override existing deed restrictions. Pre-existing CC&Rs or HOA rules on a parcel that prohibit condominium conversion can still block AB 1033 implementation. Title review is essential before starting the process.

It does not exempt the conversion from Davis-Stirling obligations. Once the property becomes a common interest development, full HOA obligations apply — annual meetings, reserve studies, required financial reporting, insurance disclosures. For a two-unit property, this overhead is real and ongoing.

It does not protect buyers from the underlying quality of the ADU. A newly-minted ADU condominium can still have the same construction defects, permit issues, or unpermitted additions as any other California property. Buyers should verify the contractor who built the ADU had valid CSLB license status at the time of construction and review the full permit history.

It does not eliminate contractor fraud risk. ADU contractor scams remain a risk regardless of ownership structure. An ADU sold separately still carries the full history of how it was built and who built it. Builders who fail VerifiedADU verification standards are publicly documented on our removed contractors page with the reason shown.

For California ADU builders operating in 2026, the practical effect of AB 1033 is geography-specific. In San Jose, Santa Monica, and unincorporated San Diego County, builders can reasonably market new ADU construction as a potential future separately-sold asset. In the rest of the state, the value proposition is still rental income and primary-home value lift.

For homeowners, the near-term implication depends entirely on local adoption. In opted-in jurisdictions, AB 1033 creates a legitimate separate-sale exit that did not exist before. In non-adopting jurisdictions, an ADU remains legally tied to the primary dwelling for ownership purposes.

The medium-term trajectory has been slower than the bill’s authors anticipated. Each city’s adoption requires staff work, council action, and resolution of local policy questions around density, parking, and affordability mandates. Cities that have studied AB 1033 have raised recurring concerns about neighborhood character, HOA formation overhead on two-unit parcels, and the potential for speculative flipping.

Homeowners who want to stay ahead should make decisions based on current law in their city, not anticipated future adoption. Building an ADU today in a non-adopting city with the specific expectation of separate sale later is a bet, not a plan.

Across every California jurisdiction, the CSLB verification baseline for any ADU project remains the same: active license status, bond on file, workers’ compensation current, and a clean complaint record. That baseline applies whether the ADU will be rented, sold separately under AB 1033, or kept within a single ownership structure.