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Popular granny flats create a niche industry in LA

This time last year, Andrei Pogany's Los Angeles-based home design business was centered on single-family houses and additions. 

But in recent months, half of his work has been designing accessory dwelling units, or "granny flats"  — which he expects to become an even bigger chunk of his business as Angelenos embrace small backyard homes at a pace not seen elsewhere in California.

"Not to sound architecturally nerdy, but they're fun," said Pogany, who's started a granny flat blog. "It's like building a new house, but they're smaller so we can do them faster." 

A new niche business is opening up for architects and builders as the application rate for accessory dwelling units in Los Angeles far outpaces any other major California city. L.A.'s planning office had received nearly 2,000 applications by November, according to the Terner Center for Housing and Innovation at UC Berkeley. In contrast, the city approved permits for just 80 units in 2016 and 90 units in 2015. 

Angelenos are outpacing fellow Californians when it comes to applying for accessory dwelling unit permits.
Terner Center for Housing Innovation
Angelenos are outpacing fellow Californians when it comes to applying for accessory dwelling unit permits.

Terner Center Policy Director David Garcia attributed the spike in interest to a new state law that took effect this past January that streamlined the permitting process for accessory dwelling units, loosened parking regulations and prevented heavy utility hookup fees. 

Garcia said he wasn't surprised by the burst of applications in Los Angeles, given the region's need for affordable housing.

"Accessory dwelling units make a lot of sense in a city like L.A.," he said, noting that most of the local housing stock is comprised of single-family homes with roomy backyards.

"It gives homeowners the opportunity to create new housing on their own for relatives or for extra cash flow into their property" as a rental, said Garcia. 

A rendering of an accessory dwelling unit designed by L.A.-based design firm Modative.
A rendering of an accessory dwelling unit designed by L.A.-based design firm Modative.

L.A.-based Modative, a firm that designs and builds homes, made a company-wide commitment to accessory dwelling units at the start of the year, said co-founder Derek Leavitt.

"We think it's going to be the next big thing in L.A.," he said.

Leavitt pointed out that the development side of Modative's business had slowed down because of increasing land prices and new regulations. But accessory dwelling units bypass both of those issues, he said, because "land is already available for additional housing units and the regulations are lax." 

For the last six months his company has been working on designing accessory dwelling units that can be mass-produced, said Leavitt.

"What we want to do is create a soup-to-nuts solution for them," he said. "Once they select the unit, we handle everything for them from the semi-customizable designs to the permitting process, even educating them on what it is to be a landlord."

Leavitt said the hope is to have prototypes ready by spring. 

Pogany, on the other hand, works on customizing accessory dwelling units to match the style of the existing house. For instance, a granny flat in the yard of a traditional Spanish-style home will also get a red tile roof. 

He said that word about granny flats has quickly spread among his friends, who range in age from the late 20s to the early 40s. Not only can backyard units be a cost-efficient alternative to buying a bigger home, they also represent a desire to live on a smaller scale, said Pogany.

"A lot in our demographic are looking toward smaller homes," he said. "Accessory dwelling units can fit right in between the tiny home movement and your more traditional 2,500 square foot home."

One of Pogany's clients is Andy Coffing of Atwater Village, who's converting an old backyard unit into an airy cottage with windows, bathroom and Murphy bed that will double as a photography and Kundalini yoga studio for his wife. This was a better option than moving out of their 1,200 square foot home into a bigger house, Coffing said. 

"At least in my sphere, I think people are just becoming less ostentatious and needy in general," he said.

Under state law, backyard units can be as big as 1,200 square feet. But cities can limit their size, and the city of Los Angeles is expected to adopt an ordinance that does that sometime next year.