The rebirth of the granny flat

By Liz Pulliam Weston

Cathy Murphy's mother has health problems, and Murphy wanted the older woman to move closer. But Murphy and her family live in Santa Cruz, Calif., where the median home price in June, according to real-estate research firm DataQuick, was $746,500.

A few years ago, one solution -- a "mother-in-law" apartment in the Murphys' back yard -- would have been difficult, if not impossible, to do legally. But unlike other cities that have fought against increased density, Santa Cruz in 2002 decided to embrace it.

Among other moves, Santa Cruz:

• Streamlined the permit process, eliminating most of the red tape that prevented single-family homeowners from converting garages, basements and backyard space into "accessory dwelling units" or "granny flats."

• Offered low-interest loans up to $100,000 to finance construction of the units, which are required to have their own kitchens, bathrooms, sleeping areas and separate entrances.

• Created tools, including a manual, a video, a set of architectural plans and other information, showing residents how to plan, design and get permits for the new living spaces.

The Murphys are thrilled with the result. Mom now lives in a 640-square-foot, custom-built detached cottage just steps from the family's back door. She has privacy, but she's also available for frequent visits, especially from her 6-year-old grandson.

"They've always been great friends, and he loves to run over and visit," Cathy Murphy says. "I didn't have that -- my grandparents lived far away -- so I really see the value in it."

Boon or bother?

Expensive cities have struggled for years with what to do about granny flats. On one hand, they can be a boon to families who want to stay close, providing housing for elderly parents or a first home for young adults who can't quite afford to leave the nest.

On the other, they easily can be converted to rental apartments that increase density, noise and parking problems in already teeming communities. Some homeowners complain the rentals degrade the quality of neighborhoods and depress property values. At worst, illegal conversions, done without permits and inspections, can be potential firetraps.

From Seattle to Queens, city officials and residents have argued about the best approach. Some cities, like Orem, Utah, initially encouraged the building of mother-in-law apartments, only to suffer neighborhood backlash as the units were converted to rentals by absentee landlords. Other cities send out patrols of inspectors, either independently or as the result of neighbors' tips, to shut down illegal units.

(The attitude of many cities toward granny flats was illustrated by what happened to one that was attached to the garage of my first home in Laguna Beach, Calif. Many years before I bought the property, the city had sealed the toilet and sink drains of the illegal unit with concrete to ensure the previous owner couldn't rent it out again.)

Continued: Some call the flats 'a suburban blight'

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