What are the potential implications of building an ADU regarding local rent control regulations?

Building an Accessory Dwelling Unit (ADU) can have significant implications concerning local rent control regulations. While many states and municipalities exempt ADUs from these rent control laws to encourage development, the primary dwelling on the property could be affected. Here are essential aspects to consider:

• Exemptions for New Construction: Many jurisdictions do not apply rent control to newly constructed ADUs, meaning you could potentially keep the rental rates flexible for this space.
• Effect on Primary Dwelling: Adding an ADU may classify your property as multi-unit, bringing the primary house under rent control, depending on local laws.
• Legal Readiness: It's crucial to consult with a real estate attorney and research your local regulations at the onset to avoid unintentional compliance issues.

Understanding the nuances of rent control as it relates to ADUs will allow you to make educated decisions about your property investment.