AB 1033 California: How to Sell Your ADU as a Condo (2026)

What AB 1033 changed

Before AB 1033, an ADU was permanently tied to the main house — you could rent it but you could not sell it on its own. AB 1033, effective January 2024, lets cities opt in to a process that converts an existing or new ADU into a condominium that can be sold separately.

How the condo conversion works

If your city has opted in:

1. The ADU and main house are surveyed as separate condominium units.
2. A condominium map and CC&Rs (covenants, conditions, and restrictions) are recorded.
3. The ADU gets its own deed and can be financed and sold like a standalone home.
4. Both units typically share a common-area maintenance agreement.

Which California cities have opted in

The list is growing. As of mid-2026, several Bay Area and Southern California cities have adopted local ordinances enabling AB 1033 condo conversions. Your city's planning department can confirm whether you are eligible.

Pros and cons of selling your ADU as a condo

Pros:

• Unlocks the ADU's equity without selling your main home.
• Creates a faster resale path than typical homes (smaller price point, growing buyer pool).
• Lets aging owners downsize without leaving the property.

Cons:

• Title and escrow are more complex.
• HOA-style CC&Rs add ongoing administration.
• Some lenders are still cautious about financing AB 1033 condos.

Should you design your new ADU for AB 1033?

If selling separately is a realistic future plan, build the ADU with that in mind: separate utility meters, a clearly delineated yard area, and a private entrance with no shared circulation through the main house.

Related reading

• SB 9 California explained
• Backyard ADU complete guide 2026
• ADU property tax impact
• Vision ADU Service Areas

Frequently asked questions

Does AB 1033 apply automatically in every city? No. Each city must opt in by passing a local ordinance.

Can I retrofit an existing ADU into an AB 1033 condo? Yes if your city has opted in and the ADU meets condo conversion requirements.

Do AB 1033 condos qualify for conventional financing? Increasingly yes, but lender availability varies. Ask your loan officer early.