Jean-Prescott Studio
Long Beach Offers Up to $250K in Zero-Interest Loans to Homeowners for ADU Construction
The city of Long Beach has introduced a new program offering zero- and low-interest loans of up to $250,000 to homeowners for building Accessory Dwelling Units (ADUs). This initiative, part of the $2.5 million Affordable ADU Loan Program, is designed to help alleviate the housing shortage and provide rental units for low-income families. A key requirement for homeowners is that they must rent the ADU to a low-income household for at least five years, with priority given to those willing to rent to individuals with housing vouchers. The program is expected to support Long Beach’s housing goals and could serve as a model for neighboring areas like Los Angeles County, which also faces housing and homelessness challenges. Applications are open now, with loans expected to be disbursed early next year.
Long Beach Offers Up to $250K in Zero-Interest Loans to Homeowners for ADU Construction
The city of Long Beach has launched an innovative program aimed at addressing two major challenges: the housing shortage and the need for affordable rental options. Homeowners are now eligible for zero- and low-interest loans of up to $250,000 to build an Accessory Dwelling Unit (ADU) on their property. The Affordable ADU Loan Program is a $2.5 million initiative designed to increase housing availability while providing rental opportunities for low-income families.
However, there’s a key requirement for homeowners who wish to take advantage of this program: they must rent the ADU to a low-income family for at least five years. Priority will be given to those willing to rent to individuals with a Long Beach housing voucher. These vouchers are federally subsidized, ensuring that rent payments are made in full by the government.
This program is a great way to incentivize homeowners to invest in their property while positively impacting the community. With ADU rents in Long Beach ranging from $2,200 for a studio to $3,200 for a two-bedroom, depending on the location, homeowners stand to gain significantly. Even with loan payments estimated at around $800 a month, they can still benefit financially after fulfilling the affordable rent requirement.
City officials, like Chavez, are optimistic about the program’s potential. "It benefits a lot of families," said Chavez. By incentivizing ADU construction, the city hopes to boost housing availability and provide relief for low-income renters. The program could also help Long Beach meet its state-mandated goal of constructing 26,000 housing units by 2028.
While this initiative is a step forward, Los Angeles County which faces an even larger housing crisis, should consider similar programs. With a $1.3 billion annual budget dedicated to homelessness, Los Angeles could significantly benefit from such a program to address the housing needs of its unhoused population. By offering zero-interest loans to homeowners and prioritizing low-income renters, the county could create more affordable housing while simultaneously leveraging its resources to reduce homelessness.
Applications for the Affordable ADU Loan Program are now open, with the first loans expected early next year. For homeowners looking to build an ADU while contributing to the community, this program presents a unique opportunity to make a difference while adding value to their property.
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