Accessory Dwelling Units (ADUs) gained significant popularity between 2020 and 2025, especially in California and San Diego. Multiple factors contributed to this growth. Regulatory changes, including state laws such as AB 68 and AB 881, reduced zoning restrictions and streamlined permitting processes. These legal shifts made it easier for homeowners to add secondary units to their properties.

San Diego County data shows a large increase in ADU activity. Permits rose from 1,150 in 2020 to 3,991 in 2024, a 247 percent increase. Completed ADU units grew by 480 percent during the same period. This reflects strong local adoption driven by housing shortages and new incentive programs, including the ADU Bonus Program.

Reports covering national and global markets confirm the trend. One study values the ADU market at 3.3 billion dollars in 2023, projecting growth to 10.6 billion by 2030. Another report places the global ADU market at 18 billion dollars in 2024, with an expected rise to 43.35 billion by 2034. Industry publications describe ADUs as a growing solution for multigenerational living, rental income, and flexible housing needs.

Between 2020 and 2025, ADUs transitioned from a niche concept to a mainstream housing strategy, supported by policy changes, economic pressures, and increasing demand for adaptable residential space.