By Hank Russell
A local congressperson is supporting a bill that would allow homeowners to finance the construction of accessory dwelling units (ADUs) that can be rented out. The legislation has been introduced and is currently in committee.
U.S. Representative Andrew Garbarino (R-Patchogue) said he supports the Supporting Upgraded Property Projects and Lending for Yards (SUPPLY) Act, which was introduced by Sam Liccardo (D-California) on July 17.
The SUPPLY Act would help address the national housing shortage by expanding access to financing for Accessory Dwelling Units (ADUs), also known as backyard cottages, granny flats, or in-law suite, according to Liccardo.
Across the country, ADUs have become an increasingly important tool for addressing the housing crisis, Liccardo said. Yet, most ADUs today are financed through savings or home equity lines of credit by relatively affluent homeowners, because modest-income and younger homeowners cannot get second loans on their homes where they lack the equity.
The SUPPLY Act will provide government-backed, flexible financing options to help homeowners of modest means overcome what is often the last hurdle to breaking ground on an ADU.
“On Long Island, families work hard to create economic opportunities for themselves and their communities. Sometimes that opportunity is right in their own backyard, and they just need the tools to seize it,” said Garbarino. “The SUPPLY Act would help New Yorkers access financing and provide the flexibility to turn in-law suites, converted garages, and other Accessory Dwelling Units on their property into spaces that build long-term value. This bipartisan bill gives families the chance to invest, grow equity, and strengthen our local economy.”
When he was mayor of San Jose, California, Liccardo removed the red tape involved in financing an ADU. Soon, homeowners submitted 1,000 permit applications. However, they ran into another problem.
“After they got the permits, too many homeowners faced another barrier: a lack of financing options,” said Liccardo. “With access to capital, we can empower homeowners to become home providers for thousands of renters in every metropolitan area.”
National Association of Home Builders (NAHB) Chairman Buddy Hughes said this bill will help alleviate the nation’s current housing crisis.
“{[This] legislation … will address our nation’s housing supply shortage by making it easier to finance accessory dwelling units (ADUs),” Hughes said. “By allowing HUD to insure second mortgages for homeowners seeking to finance ADU construction, this bill will ensure that property owners have access to ADU financing, which will ease housing shortages and improve affordability.”