Is New Housing Actually Getting Built in the South Bay? What ADU and SB 9 Permit Data Really Shows in 2026

Published July 15, 2026

ADUs are now over a quarter of all new California homes permitted. Lot splits under SB 9 are still rare. Here is what that means for South Bay rental supply.

Accessory dwelling units, not new apartment towers or SB 9 lot splits, are where most new small scale rental supply in California is actually coming from. The state issued 30,354 ADU permits in 2024, accounting for more than 26.6% of all homes permitted statewide that year, according to the California Department of Housing and Community Development. By contrast, urban lot splits and duplexes under Senate Bill 9, the 2021 law that took effect January 1, 2022, remain a small share of new units almost everywhere, including the South Bay.

What SB 9 actually did, and did not do

SB 9, formally the California Housing Opportunity and More Efficiency (HOME) Act, was signed by Governor Newsom in September 2021 and took effect January 1, 2022. It requires cities to ministerially approve, without discretionary review, either a duplex on a single-family lot or an urban lot split that can result in up to four units on a formerly single-family parcel, subject to owner-occupancy and other conditions. It applies statewide, including every South Bay city, and cannot be blocked by local zoning that conflicts with it.

A separate, unrelated 2025 bill also carries the SB 9 number this session (authored by a different legislator, focused on state authority to void noncompliant local ADU ordinances), which has caused some confusion online between "SB 9 the lot-split law" and "SB 9 the 2025 ADU enforcement bill." They are different pieces of legislation. This article is about the 2021 lot-split and duplex law, which is the one that affects how many new units can appear on an existing single-family lot.

In practice, take-up of SB 9 lot splits and duplexes has been modest almost everywhere in the state, including cities like Torrance, Redondo Beach, El Segundo, and Manhattan Beach. High land costs, lender and title complications on newly split parcels, owner-occupancy requirements, and the sheer cost of adding a second structure all slow adoption. Every California city is required to report its housing production, including SB 9 units and ADUs, in an annual Housing Element Annual Progress Report (APR) filed with HCD, and each South Bay city's individual APR is the authoritative source for its own unit counts.

Where the real growth is: ADUs

ADUs are a different story. Since the state overrode restrictive local ADU ordinances starting in 2020, ADU permitting has climbed steadily, and by 2024 ADUs represented more than a quarter of every new home permitted in California. That is a meaningful, durable channel of new small-unit rental supply, because most ADUs get built specifically to rent out, not for a family member. Each South Bay city files its own count of ADU permits, completions, and RHNA (Regional Housing Needs Allocation) progress with HCD every year, and that Housing Element Annual Progress Report is the correct place to look for a specific city's exact numbers rather than a statewide estimate.

What this means practically for owners is that the added rental supply nearest to you is far more likely to be a backyard unit or garage conversion on a neighboring single-family lot than a new fourplex from a lot split. That supply adds up slowly, one property at a time, and does not show up as a sudden glut the way a large apartment project would.

What this means for you

Do not assume SB 9 has flooded your neighborhood with new fourplexes. Adoption has been slow almost everywhere, and the paperwork and financing friction on a lot split are real. Do expect a slow, steady trickle of new ADU rentals nearby, since that is where the state's own numbers show the growth actually is. If you are weighing whether to add your own ADU as a second rental income stream on a property you already own, that math (permit cost, timeline, rent it can command) is worth running property by property rather than assuming it pencils the same everywhere in the South Bay.

If you want the exact SB 9 and ADU permit counts for your specific city before deciding anything, that is the kind of digging we do for our owners rather than leaving you to read a state PDF.

This is general information, not legal or tax advice. Confirm with a licensed professional before you act.

Sources

1. California HOME Act (SB 9), California YIMBY
2. Bill Text, SB-9, 2021-2022 Regular Session, California Legislative Information
3. California Department of Housing and Community Development SB 9 Fact Sheet
4. HCD ADU Handbook Update
5. HCD Housing Element Annual Progress Report instructions
6. HCD Annual Progress Report Data Dashboard

Last verified: July 2026.

Topics: market, sb-9, adu, housing-supply, south-bay

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