City and County of San Francisco
Status: Active
Board File: 241069
In July 2025, San Francisco officially opted into AB 1033, creating a legal pathway for certain newly permitted ADUs to be subdivided and sold as condominiums. For the first time, qualifying backyard units can be independently deeded and sold — without going through the city’s traditional condo conversion lottery.
Key Highlights
Lottery Bypass
ADU condo conversions under Ordinance 113-25 are exempt from San Francisco’s annual condominium conversion lottery — a major barrier that historically limited small building conversions. This removes one of the biggest structural hurdles to separate sales.
Fast-Track Path
Qualifying ADUs are processed ministerially under the Local Program, with streamlined review and limited discretionary oversight. Once built and approved, the subdivision process follows a defined, codified pathway.
Targeted & Protected
The ordinance applies only to ADUs with permit applications submitted on or after May 1, 2025, and includes strong tenant-protection safeguards. Detached units on single-family lots are prioritized, preventing displacement while creating brand-new for-sale inventory.
San Francisco Opened the Door to ADU Condo Sales
San Francisco amended both its Planning Code and Subdivision Code to allow qualifying accessory dwelling units to be legally subdivided as condominiums. Instead of being permanently tied to the main home, the ADU can now become its own legal property interest — with its own deed, title report, tax bill, and resale value.
The program primarily targets single-family homes and small buildings with fewer than four units. Detached ADUs are the clearest candidates. Junior ADUs are excluded. The property must not have had a qualifying no-fault eviction of a protected tenant since May 1, 2005, and written lender consent is required if there is an existing mortgage.
It is fully active. Ordinance 113-25 took effect August 10, 2025. The subdivision exemption has been codified in the Subdivision Code, and SF Planning has integrated the framework into its ADU Local Program guidance.
San Francisco’s strategy is deliberate: create brand-new, sellable ‘in-law’ inventory without reopening contentious legacy condo conversion debates. By limiting eligibility to newly permitted ADUs and exempting them from the condo lottery, the city has carved out a narrow but powerful equity pathway for homeowners.
San Francisco Coverage & Policy Resources
Ready to Explore an ADU Condo Conversion in San Francisco?
If you own a single-family home or small property in San Francisco and are planning a new ADU, timing matters. We help homeowners evaluate eligibility under Ordinance 113-25, navigate lender consent, and understand whether a separate condo sale is realistic before construction begins.