Did California make it legal to sell an ADU separately from the house?

It created a pathway, which is different. Government Code § 66342 lets a local agency adopt an ordinance permitting the primary dwelling and ADU to be conveyed separately as condominiums. The word is may. If your city has not adopted such an ordinance, the route does not exist at your address.

Can my mortgage lender stop me?

Yes, and this is the provision most summaries omit. Section 66342(d)(1) requires every lienholder's written consent before a subdivision map or condominium plan can be recorded, and subparagraph (A) states that a lienholder may refuse to give consent. Subparagraph (B) lets a lienholder consent subject to whatever terms and conditions it requires.

What does the lender actually have to sign?

A written consent recorded with the plan, including the lienholder's signature, the name of the record owner or ground lessee, the legal description, and the identities of all parties with an interest in the property, together with a prescribed statement that the lienholder consents in its sole and absolute discretion. Section 66342(d)(2) and (3) set out the form.

What is the § 66341 route?

A narrow affordable-housing pathway. It applies where the ADU or the primary dwelling was built by a qualified nonprofit corporation, there is a recorded enforceable land-use restriction meeting Revenue and Taxation Code § 402.1(a)(10), and the property is held under a recorded tenancy-in-common agreement allocating unequal undivided interests, giving the nonprofit a repurchase option, requiring owner occupancy, and preserving the units as low-income housing for 45 years.

Does the condominium route require a subdivision map?

The condominiums must be created in conformance with all applicable objective requirements of the Subdivision Map Act and of any local subdivision ordinance, under § 66342(b), and under the Davis-Stirling Common Interest Development Act under § 66342(a). This is a real subdivision process, not a form.

Is there an inspection requirement?

Yes. Before the condominium plan is recorded, § 66342(c) requires a safety inspection of the ADU, evidenced either by a certificate of occupancy from the local agency or a housing quality standards report from a building inspector certified by the US Department of Housing and Urban Development.

Can I sell a JADU separately?

No. Section 66333(c)(1) requires a recorded deed restriction prohibiting sale of the junior ADU separately from the single-family residence, expressly enforceable against future purchasers. If separate conveyance is a goal, a JADU is the wrong instrument.

Should I design an ADU around selling it later?

Only with your eyes open. The route depends on a local ordinance that may not exist, and on a lender consent that can be refused at the lender's sole discretion. Building to condominium standards is not wasted if it also produces a better unit, but treating separate sale as a certainty in your financial plan is not supported by the statute.

Can you sell an ADU separately in California? Two paths, both narrower than advertised

PUBLISHED SEPTEMBER 10, 2026 · UPDATED SEPTEMBER 10, 2026 · REVIEWED BY MILAD KAZEMI

Not by default, and not by right. There are two routes. Government Code § 66341 requires a local agency to allow separate sale only in a narrow affordable-housing scenario: the unit was built by a qualified nonprofit corporation, there is a recorded land-use restriction, and the property is held under a tenancy-in-common agreement with 45-year affordability restrictions. Section 66342 is the condominium route commonly associated with AB 1033 — but it is permissive, not mandatory. A local agency may adopt an ordinance allowing it, and where one exists the plan must comply with the Davis-Stirling Act and the Subdivision Map Act, the ADU must pass a safety inspection, and every lienholder must consent in writing. Section 66342(d)(1)(A) states plainly that a lienholder may refuse.

Law verified as of 10 September 2026 against the text published by the California Legislature. Sections 66341 and 66342 were added by SB 477, Stats. 2024, ch. 7, which relocated California’s ADU law into Chapter 13.

The claim and the statute

The claim circulating since 2023 is that California made it legal to sell your ADU separately from your house. The statute is more careful than that, in two ways that decide whether the idea is available to you at all.

Route one: the condominium ordinance — § 66342

This is the route commonly associated with AB 1033, and it is permissive. The section opens by saying a local agency “may also adopt a local ordinance to allow the separate conveyance of the primary dwelling unit and accessory dwelling unit or units as condominiums.”

May. If your city has not adopted one, this route is not available at your address, and no amount of design intent changes that. That is the first question to ask, before anything else.

Where an ordinance does exist, § 66342 requires all of the following:

Davis-Stirling. The condominiums must be created under the Common Interest Development Act — § 66342(a).
Subdivision Map Act. In conformance with all applicable objective requirements of the Act and of any local subdivision ordinance — § 66342(b). This is a genuine subdivision, with the time and cost that implies.
A safety inspection before recordation, evidenced by a certificate of occupancy or a housing quality standards report from a HUD-certified inspector — § 66342(c).
Written consent from every lienholder — § 66342(d).
A prescribed consumer notice on the agency’s ADU submittal checklist and as a standard condition of the permit — § 66342(e).

The provision that decides most cases

Point four is the one that gets left out of summaries, and it is usually determinative:

(A) A lienholder may refuse to give consent. (B) A lienholder may consent provided that any terms and conditions required by the lienholder are satisfied.

Your mortgage lender holds a lien on the whole property. Splitting that property into condominiums changes the collateral behind its loan. Section 66342(d) gives the lender an unqualified veto, and the statutory consent form it must sign says it consents “in their sole and absolute discretion.”

That is not a technicality to be worked around later. If you are carrying a mortgage and planning around separate conveyance, the conversation with your lender belongs at the beginning, not after the unit is built.

Route two: the nonprofit path — § 66341

Section 66341 is mandatory — a local agency shall allow separate sale — but only where a specific set of facts holds:

The ADU or the primary dwelling was built or developed by a qualified nonprofit corporation.
There is a recorded enforceable land-use restriction between the qualified buyer and that nonprofit, satisfying Revenue and Taxation Code § 402.1(a)(10).
The property is held under a recorded tenancy-in-common agreement that allocates unequal undivided interests by dwelling size, gives the nonprofit a repurchase option, requires the buyer to occupy the unit as a principal residence, and preserves both units as low-income housing for 45 years.
A grant deed is recorded with a concurrent Preliminary Change of Ownership Report.
If a utility requests it, the ADU has its own water, sewer or electrical connection — § 66341(e).

This is an affordable-homeownership mechanism. It is a real route and it works, but it is not a route a homeowner can put themselves on by choosing to.

And not at all for a JADU

Section 66333(c)(1) requires a recorded deed restriction prohibiting the sale of a junior ADU separately from the house, and states that the restriction is enforceable against future purchasers. If separate conveyance matters to you, the JADU is the wrong unit — see JADU vs ADU.

What to do with this

If separate sale is genuinely part of your plan, the sequence is: confirm whether your jurisdiction has adopted a § 66342 ordinance; then ask your lender, in writing, whether it will consent and on what terms. Both answers are obtainable before you spend anything on design.

If either answer is no, that is worth knowing early — and it does not make the ADU a bad idea. It makes it a rental and a family asset rather than a separate saleable property, which is what the great majority of ADUs in California are.

Sources

Rules change. Confirm anything you are relying on against the agency directly.

Questions we get asked

Did California make it legal to sell an ADU separately from the house?: It created a pathway, which is different. Government Code § 66342 lets a local agency adopt an ordinance permitting the primary dwelling and ADU to be conveyed separately as condominiums. The word is may. If your city has not adopted such an ordinance, the route does not exist at your address.
Can my mortgage lender stop me?: Yes, and this is the provision most summaries omit. Section 66342(d)(1) requires every lienholder's written consent before a subdivision map or condominium plan can be recorded, and subparagraph (A) states that a lienholder may refuse to give consent. Subparagraph (B) lets a lienholder consent subject to whatever terms and conditions it requires.
What does the lender actually have to sign?: A written consent recorded with the plan, including the lienholder's signature, the name of the record owner or ground lessee, the legal description, and the identities of all parties with an interest in the property, together with a prescribed statement that the lienholder consents in its sole and absolute discretion. Section 66342(d)(2) and (3) set out the form.
What is the § 66341 route?: A narrow affordable-housing pathway. It applies where the ADU or the primary dwelling was built by a qualified nonprofit corporation, there is a recorded enforceable land-use restriction meeting Revenue and Taxation Code § 402.1(a)(10), and the property is held under a recorded tenancy-in-common agreement allocating unequal undivided interests, giving the nonprofit a repurchase option, requiring owner occupancy, and preserving the units as low-income housing for 45 years.
Does the condominium route require a subdivision map?: The condominiums must be created in conformance with all applicable objective requirements of the Subdivision Map Act and of any local subdivision ordinance, under § 66342(b), and under the Davis-Stirling Common Interest Development Act under § 66342(a). This is a real subdivision process, not a form.
Is there an inspection requirement?: Yes. Before the condominium plan is recorded, § 66342(c) requires a safety inspection of the ADU, evidenced either by a certificate of occupancy from the local agency or a housing quality standards report from a building inspector certified by the US Department of Housing and Urban Development.
Can I sell a JADU separately?: No. Section 66333(c)(1) requires a recorded deed restriction prohibiting sale of the junior ADU separately from the single-family residence, expressly enforceable against future purchasers. If separate conveyance is a goal, a JADU is the wrong instrument.
Should I design an ADU around selling it later?: Only with your eyes open. The route depends on a local ordinance that may not exist, and on a lender consent that can be refused at the lender's sole discretion. Building to condominium standards is not wasted if it also produces a better unit, but treating separate sale as a certainty in your financial plan is not supported by the statute.

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