Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Eniola Odetunde/Axios

As the pandemic causes many to rethink their housing choices, accessory dwelling units (ADUs) — or granny flats — are seen as viable options for multigenerational housing or singles who want to get out of apartment buildings.

Driving the news: Cottage, a San Francisco-based startup that sells ADUs to homeowners in the Bay Area, has raised $3.5 million in seed funding led by Susa Ventures and Base10.

The big picture: In U.S. cities, about 75% of the land is zoned for single-family housing only, and proposals for multifamily housing often run up against NIMBY-ist opposition.

  • But: A set of new ADU rules went into effect in California in January, making it even easier for homeowners in the state to add these extra units to their properties.
  • Most significantly, homeowners can now add a second ADU to their property, and municipalities are barred from limiting ADUs to less than 800 square feet and 16 feet tall. There are lower parking and setback requirements, faster permitting approval, fewer fees, and the ability to add ADUs to certain multifamily dwellings.
  • Cottage, founded a year ago by Alex Czarnecki, is the latest startup to join the ADU boom. In October, startup Abodu also announced $3.5 million in seed funding.

How it works: Cottage’s pitch to customers is that it offers custom units, takes care of managing much of the process like getting permits, and does it at a lower price than many alternatives, including some prefab options.

  • Cottage says that because it can cut big deals with designers and contractors, it can get lower costs for its customers, to whom it charges a fee for managing the process.
  • After checking out a property and discussing what the client wants, Cottage budgets about one to one-and-half months for the design, about two to three for permitting, and another three to four for construction, says Czarnecki.
  • The units run about $100,000 for an entry-level garage conversion, and $150,000 for a one-bedroom detached backyard unit, though it varies based on customizations.
  • It's currently open to customers in six Bay Area counties, but it plans to soon expand to more regions on the West Coast.

What they're saying: "I'm an only child and I'm trying to be with my parents in their elderly years," Harold, a Cottage customer and Redwood City resident, tells Axios.

  • He and his wife considered options like renting an apartment for his parents or buying them a house, but ultimately, an ADU would provide them a sense of privacy, their own house, and proximity to the family, he adds.

Yes, but: While ADUs can be a solution for some housing needs, they won’t solve them all.

  • "ADUs are like the scooters of housing policy — they're flashy and cute and everyone loves them,” Jenny Schuetz, a fellow with Brookings' Metropolitan Policy Program, told Axios’ Kim Hart earlier this year.
  • “Scooters are good at getting people thinking about other ways to get around, but inherently they don't scale. Even if we put an ADU on every single-family lot in the U.S. — which of course won't happen — we wouldn't solve the problem,” she added.

Go deeper

Former HUD secretary Julián Castro says homeownership can help close wealth gaps in America

Axios' Aja Whitaker-Moore (L) and former Sec. Julián Castro (R). Photo courtesy of Axios Events

Homeownership disparity is one of the root causes of wealth gaps between white people and people of color in America, former Secretary of Housing and Urban Development Julián Castro said at an Axios Event aired Tuesday.

Why it matters: The homeownership gap between Black and white Americans is worse today than when race-based housing laws and policies were in effect decades ago. The Census Bureau reports that 42% of Black Americans and 61% of Hispanic Americans own a home — but for whites, it's 72%.

Asymptotic Florida students exposed to COVID no longer have to quarantine

Florida Gov. Ron DeSantis during a September news conference in Viera, Fla. Photo: Paul Hennessy/SOPA Images/LightRocket via Getty Images

Florida Gov. Ron DeSantis (R) announced Wednesday an emergency order allowing parents to decide whether their children should quarantine or stay in school if they're exposed to COVID-19, provided they're asymptomatic.

Why it matters: People infected with COVID-19 can spread the coronavirus starting from two days before they display symptoms, according to the CDC. Quarantine helps prevent the virus' spread.

Federal judge: Florida ban on sanctuary cities racially motivated

Florida Gov. Ron DeSantis. Photo: Joe Raedle/Getty Images

A federal judge on Tuesday struck down parts of a Florida law aimed at banning local governments from establishing sanctuary city policies, arguing in part that the law is racially motivated and that it has the support of hate groups.

Why it matters: In a 110-page ruling issued Tuesday, U.S. District Judge Beth Bloom said the law — signed and championed by Gov. Ron DeSantis (R) — violates the Constitution's Equal Protection Clause because it was adopted with discriminatory motives.