New Berkeley ADU, landlord, Airbnb, pros / cons
I'd love to hear experiences from people who have a relatively new-construction ADU (2018 or later, that is banned from 'short-term' rentals), as we are considering a detached (or attached) ADU on our large, primary residence. SFU lot (in addition to a small home addition). My understanding right now is that
- we would not need to register as landlords (2021 update)
- we would be exempt from rent control
- we would not be required to provide an additional parking space
My questions are
- Berkeley ADU law says can't be rented out short-term. OK. But ADU 2021 Guidance says not for less than 30 days ("ADUs and JADUs shall not be utilized as
commercial short-term rentals (i.e. rentals less than 30 consecutive days)", and short-term rental regulation talks about short-term rentals being less than 14 days ("If you rent your Dwelling Unit, authorized Accessory Dwelling Unit, or Accessory Building, for 13 days or less, you are considered a Short Term Rental and are required to register with the City based on Berkeley Municipal Code (BMC) Section 23C.22"). Which is currently being enforced? How are you implementing this? (We were told by an architect that we could, for example, rent through Airbnb as long as our rental was set to 14 days or more.)
- What are the pros / cons of renting (for either >14 OR >30 days) your ADU? What is it like to be a Berkeley landlord of new-er construction? Do you use Airbnb? Other more or less traditional ways of connecting with renters? I'm familiar with Airbnb as I'm helping host a property for my mother (not in Berkeley), and I like the idea of renting through them. But am open to all the options...
- We would likely need to use a HELOC to (help) fund the ADU construction. What are your experiences with ADU rentals and income covering costs. In other words, what are your net profits like? Ours would likely be a studio (or maybe one-bedroom) in South Berkeley. What should we expect or be wary of?
- What do you wish you knew before you decided to build a new ADU? Would you do it again? Why or why not? Other thoughts?
Thank you!
Parent Replies
Under Berkeley rent control laws you can't rent to anyone for under 14 days because that's a short-term rental. But as soon as someone living in your ADU (or even your own residence) has stayed past 14 consecutive days they have the rights of tenants.
There is no way to rent anything out in Berkeley for any number of days without either breaking the law or putting your property rights at risk. You can't even let a good friend or family member stay with you for a month rent-free without inadvertently turning yourself into a landlord who is now unable to move that person back out.
This is how our rent control board has destroyed the city. Their efforts to "protect" housing for renters causes everyone to remove their units from the market leaving us each year with fewer available rentals.
Hi, hope some of this will help. You would be fully exempt from both rent control, and eviction protection, and do not need to register your unit with the Rent Board. When we built our ADU in 2018, we had to sign a form saying we would never rent it via AirBnB or the like - I’m pretty sure this is still a requirement (though not 100% positive on that one. I think only older ADU’s can be rented short-term, not newly constructed). I’d suggest including a washer/dryer, and a one bedroom rather than studio if space allows. Pre-COVID, renting in Berkeley was good (for those of us exempt from Rent Board regulations); it has become harder just like all of the Bay Area has. Highly recommend joining BPOA - Berkeley Property Owners Association. Good luck to you.