California’s first ADU condo sale offers another path to homeownership

Backdoor Revolution: The Definitive Guide to ADU Development

I have been interested in ADUs for years ("DC and accessory dwelling units," "There are plenty of lots capable of accessory dwelling units in Upper Northwest," "Will carriage houses destroy city life as we know it?."  

And for a time did alley tours in Greater Capitol Hill.

Article from the Orange County Register.  From the article:

San Jose is home to the first accessory dwelling unit sold as a separately owned condo in California, city officials said, setting a potential template for a more affordable path to homeownership. But a lengthy rollout raises questions about whether the model can become a scalable solution to the state’s housing crisis — the sale comes more than two years after the state made such transactions possible.

The 749-square-foot, two-bedroom ADU on Josefina Street near downtown closed last month for $530,000. That’s about a quarter of Santa Clara County’s eye-popping $2.1 million median single-family home price in May, according to the California Association of Realtors. Real estate brokerage Redfin last month listed San Jose among the 10 most expensive U.S. housing markets, based on the share of median income needed to afford to buy a home.

ADUs, also known as in-law units or granny flats, typically have up to 1,200 square feet of living space and must include a kitchen sink, cooking appliance and separate bathroom.

The sale was made possible by a state law passed in 2023, Assembly Bill 1033, which allows homeowners to convert ADUs into condos and sell them separately from the main property, rather than just renting them out. Under the law, ADU condos come with their own property tax bills, but require an HOA agreement with the primary homeowner for common elements, such as roofs or driveways.

Historicity.  I have been intrigued by alleys, historic carriage houses, and ADUs for a long time.  First in terms of historicity.   

• DC Historic Alleys Building Survey, DC Historic Preservation Office
• "The American Alley, Part 1: A Hidden Resource," "The American Alley, Part 2: Origins of the American Alley," "The American Alley, Part 3: The End of the American Alley," "The American Alley, Part 4: Rediscovering the Forgotten Human Scale," Strong Towns/Resilience
• "History: Capitol Hill Alley Dwellings," Hill Rag

• and how on some properties there are historic carriage buildings that have been converted from horse stables to houses.  These are on regular house lots.  
• There are also some carriage houses on their own lots separate from a street facing lot, developed when the interior of large blocks were "programmed" with buildings separate from the street--often for "industrial uses" like stables, machining, storage, drayage, etc., 
• I learned from a guy I talked to once on a rear alley off of H Street NE who said that at the time (before DC liberalized ADU laws) it was legal for these buildings to have a "caretaker" apartment
• Interior blocks often were developed with housing to use up the space, make it profitable, and  sometimes as a way to provide mixed income housing--for servants, lower income people, etc.  
• (Later, instead of dealing with interior blocks, developers created intervening streets, such as Acker Place, Lexington Place, Morris Place, Morton Place, and Orleans Place between 6th and 7th Streets NE, Parker Street NE by Union Station, or blocks of rowhouses west of 5th Street NW in Manor Park like Quackenbos Street NW and Quintana Place NW)
• President's wife Ellen Wilson's claim to DC fame was her work to rid blocks of this interior  housing, probably because often the people settled there were African-Americans.

• Although some sections remained, like Millers Court NE and Brown's Court SE or on Capitol Hill and became models for building similar housing later 
• And because in upper NW, such as the lots east of 4th Street in Manor Park, the deep lots often have free standing garages or nothing, and could accommodate an ADU.  Our lot could, which I'd like to take advantage of some time.
• Transit access is key.  But I think it's best to focus ADU development within walking distance to a Metrorail station, to reduce the demand for driving.  Our house in Manor Park is about three quarters of a mile from Takoma Metrorail Station.

Affordable Housing.  Second in terms of the idea of adding "missing middle housing" and affordable housing. Missing middle housing is smaller types of housing vis a vis "normal sized" single family attached and detached houses.  In DC, it's not missing, it's just very expensive because all housing in DC is expensive.  And because there isn't a lot of it.  As noted above, it's mostly on interiors of blocks, and as a product of its time, pre-1900.

A very small house on Millers Court NE rents for $4,500 per month.  Middle housing indeed!

But the people who can afford to build an ADU might not necessarily want to provide AH.  According to a study in Greater Los Angeles ("The dark side of California’s backyard ADU boom: How much do they ease the housing shortage," LA Times):

He found that “ADU prevalence correlates with lower-income, renter-occupied, and younger households, denser populations, and areas with higher concentrations of non-white residents and registered Democrats.”

This type of housing is a form of what's being called "missing middle housing."  

In some weak markets like a neighborhood in Austin, Texas, ADUs are promoted to support multi-generational living and wealth generation through improving the value of a property by adding a unit, or to have a second income stream from the property to pay the mortgage ("Alley Flat Initiative fits small, green homes into unexpected places," CultureMap Austin, Alley Flat Initiative, Guadalupe Neighborhood Development Corporation). 

Some photos.

Parker Street NE -- the houses are narrow but still expensive because of the location.

Quintana Place NW -- the houses are more colonial, Tudor and not contiguous but in units of two because the National Capital Planning Commission ruled  sometime in the 1920s that rowhouses couldn't be contiguous (seen as an anti-African American policy decision)

Lexington Place NE -- the Queen Anne rowhouse style typified by the houses on Parker Street NE started to be succeeded by a more Craftsman form, often called Wardman style after the developer.  This transition started around 1907. ("What's in a Wardman? A Short Overview of DC's Most Prevalent Architecural Style," DC Urban Turf).

Millers Court SE is super well situated.  A block from the Supreme Court.  Two blocks from the Capitol.

Third, I've wanted to put one on our lot.  But ADUs aren't as cheap to build as people say.

1.  everyone says "oh, they're cheaper because you don't have to buy the land."
2. That's a little true, but the cost of permitting and new construction and financing is still high, over $250/s.f.
3. Plus the cost of installing electricity and water/sewage (and maybe gas).
4. They are hard to finance, although you can do it through a home equity loan I suppose.  And then the rents can't be super cheap because you have to pay off the cost of construction plus the various annual costs.

This is a garage on the rear of a lot on the 4400 block of River Road NW in DC.  It's a similar configuration to our lot in Manor Park.

The amounts of money cities offer to encourage ADU construction aren't very much and usually require renting out at less than market rates.

To facilitate this "the city" or nonprofit should create an ADU clearinghouse working with property owners to finance and build, and then with property owners and renters to facilitate rentals in a systematic way.

CDCs to build and finance at scale.  Gosh a good 12+ years ago I suggested the creation of a community development corporation that would operate city wide doing this.  Ideally, on our block you could build as many as 32 ADUs, they could go in on a block, with a city incentive too, and try to get multiple property owners to do it at the same time, to cut costs.

A number of firms do this now in the Midwest, such as ADU America, and in the Pacific Northwest and California (ADU Resource Center).

Pattern Books to make building ADUs easier.  Some cities have also created ADU pattern books to facilitate permitting and lower cost construction.  Often they include more modern buildings which don't appeal to me.  I prefer that ADUs match the prevailing neighborhood architectural style be it Queen Anne or Craftsman rowhouse, Colonial, etc.

-- ADU D.C. Homeowner’s Manual, Coalition for Smarter Growth

-- Philadelphia Rowhouse Manual (not on ADUs, but historic rowhouses, providing indirect guidance for how to do pre 1914 style ADUs)

-- A Pattern Book for Founders’ Place Neighborhood, Muscogee, Oklahoma, Oklahoma University-Tulsa Urban Design Studio

-- Del Ray Neighborhood Residential Pattern Book, Alexandria, Virginia

-- Accessory Dwelling Unit Guidebook, Boston Planning Department

-- A Pattern Book for Neighborly Houses, Habitat for Humanity, (I like the points about context sensitive development, it's not so much about ADUs)

-- ADU Pattern Book for Mid-Century Homes, Family Housing Fund

-- Building an ADU, Salt Lake City

-- ADU Pattern Book, MB Architecture

-- Changing Lanes: Laneway Suites in Toronto

Problems:  Some people don't want to share.  Granny flats/Yay or Nay.  Originally, were called "granny flats," with the idea that downsizing parents would relocate to an ancillary dwelling on their children's property

But some people don't want to share their lots.  "An Honest Conversation About Toronto Laneway Houses," Toronto Realty Blog.  From the article:

But why do people disagree on laneway housing? And what issues are at the forefront of the discussions? “An honest conversation,” i.s what I called this in today’s blog title, and that’s what I’m aiming for because I feel like the discussion about laneway housing in Toronto is merely getting started. 

 A client of mine remarked last weekend, “I have no problem if somebody else wants to build a laneway home on our street. But I don’t think I’d take one if it were free. I don’t want somebody living in my backyard with a window that looks out to where my kids play, and I don’t want to park my car under their living room.”

The LA Times has a series of articles on ADUs, and many involve multi-generational families, so sharing the lot isn't an issue.  And sometimes it's not for granny, but for the adult children. ("She couldn’t afford L.A. rent after law school. Her parents’ ADU came to the rescue").  

There are many in the Belmont Heights neighborhood of Long Beach.  We stayed in one as an airbnb.  A less than one mile walk to the beach...

For others, it's an ancillary studio not to be rented out ("Thanks to a tiny ADU, an L.A. home transforms into a stunning art gallery and studio," "Surprising ADU with tricked-out garage, rooftop deck matches family’s playfulness").  This is a big issue now with work from home.

But for unrelated people, if they aren't into the idea of having renters, an ADU may not be appealing.

Problems:  Financing.  It's still difficult to get traditional financing.  And adding an ADU if you have a mortgage, you have to notify the lender. ("Should I take a bridge loan to build an ADU?," LA Times); 

Problems:  Parking.  DC requires that building an ADU doesn't reduce parking on the lot.  In an area like Manor Park, this is dumb because there is plenty of street parking.  Less so in rowhouse neighborhoods in the core.  Basically, people can create "parking pads" that double as patios. Also see "A Koreatown parking protest: Tenants stage sit-in to protest loss of parking to make way for ADUs," LA Times.

Green Alley initiatives.  Separately, a number of cities are pursuing "green alley" initiatives where they are focusing on plantings, stormwater capture, and sometimes placemaking (" In Miles of Alleys, Chicago Finds Its Next Environmental Frontier," New York Times, "To Battle Floods, Cities Revive Their Long-Forgotten Alleyways,"JSTOR, "Cities Give Alleys New Life," Governing).  

-- Chicago Green Alley Handbook

In the early 2000s I read an article in (I think) Southern Living about Calder Loth, then State Architectural Historian for Virginia, and his initiative planting flowers in his alley in the Fan District ("The Self-Taught Gardener: Division Street," Berkshire Edge).

Alley repaving.  DC had a green alleys program but it never did much.  

Separately the Department of Transportation created a program still in operation that actively repaves alleys, many of which were in disrepair, with a polyglot of materials, using brick or asphalt block where it had been in use.  

Except that originally they only used red brick, and some alleys originally had yellow brick or other treatments.  I know I called for a change in this to be more historically accurate and they did change, according to this Instagram post.

This image shows yellow brick on the alley, and red brick fronting the sidewalk/apron to the street.

There is an alley off North Capitol SE, where one of the abutting property owners put in (or maintains) historically accurate cobblestones, with a brick track for "carriage wheels."  

Although, if you walk on cobbles, like some streets in Georgetown, it's not comfortable.

Placemaking and retail laneways initiatives.  ("Hidden in Plain Sight: Activating Urban Alleys," MRSC)

-- Living Alleys Toolkit, Austin

For at least 15 years, Melbourne has been reactivating alleys as retail spots.  In the US, larger real estate projects are often using the laneway concept as a way to activate interior spaces and add a fun element to the development.

Sydney, Austrailia

Retail laneways initiatives.   

-- Melbourne's Revitalized Laneways, Gehl Architects

-- Pocket Book of Melbourne Laneways

-- "Australia’s laneways investment is breathing new life into its cities," Monocle

-- Pioneer Square Alleys Design Manual

New interpretation of courtyard housing in Chicago says F.U. to the street

Courtyard housing is a home-y type where instead of houses on either side of a block facing the street, there is sidewalk and somewhat communal public space, open to the neighborhood in which it's embedded.  Apartments use the type too, organized as a horseshoe around communal space.  

Ross Chapin's Pocket Neighborhoods is about the type, and it's beautifully written.

It would be considered "missing middle housing," but I think that's somewhat of a mis-classification.  Or at least, I think the communal/non-street elements are more important to focus on.

It's more of group oriented housing development rather than a focus on single occupant dwellings as 

Design-wise, except for it being apartments and a locked entry way, the set up of the apartment building on the tv show Melrose Place is similar, except the pool functions the common space.  This building reintroduced us to courtyard housing.

Pre-war apartment buildings often used this physical design without a focus on developing communal elements of the space.

Salt Lake has a bunch of good SFH examples, including Boulevard Gardens.  I just saw "a new to me" one on 800 East.

Crain's Chicago Business has a story,"Architects' redesign of a Chicago classic becoming reality in the West Side," about how two architectural firms have created a modern version.  The exterior, butt ugly, has no charm, and it's perpendicular to the street so that the courtyard is disconnected and focused only on the residents within.  There isn't much charm.  I can't imagine there's much communal activity in the space.  They miss the point on what community and connectedness mean.

Wall Street Journal article "How Zoning Ruined the Housing Market in Blue-State America"

While there is no question that "legacy" residents tend to disfavor changes to their neighborhoods, including the addition of housing, and that's worthy of criticism, there are a number of other arguments that anti-zoning advocates espouse which are facile.

1.  Most residential housing in center cities was built before 1940, when the US population was 132,164,569.  Today's population is about 311,000,000, an increase of 2.35x.

2.  And many of those cities--not the rowhouse dominated cities--didn't use land very efficiently.  For example the rowhouse type common to Mid-Atlantic cities, packs a lot more units into a typical block, maybe 32 single family detached houses versus 64-72 rowhouses.

Neighborhoods built later use land even more inefficiently, with almost uniformly large(r) lot development--until the 1980s when land costs rose.  Our house lot in Salt Lake City could easily accommodate 4 rowhouses instead of one ranch style house.

3.  Furthermore, the average household size is shrinking, requiring more housing to house the same number of residents.

4.  Today land is a lot more expensive making "American Dream" style houses--detached homes with a yard--unrealistic in center cities and inner ring suburbs.

5.  But a significant number of people still want an American Dream style house, not the multiunit apartments now being built in cities.   This forces them to move much further out, where property is relatively cheaper.

6.  Related to (2) inefficient use of land, owner occupied housing is almost impossible to re-assemble in order to build new housing with more units on the same amount of land.  I am familiar with only a couple examples, one in Fairfax County, Virginia in the late 1980s, the 200 block of K Street NE in Washington, DC, but that block was zoned half industrial to begin with, making land consolidation much easier, and a block in Ann Arbor near the Michigan Stadium ("Land Use intensification in Ann Arbor," 2022).

7.  One key flaw of zoning is that it tends to be pretty homogeneous in intent, in that single family detached housing is in one zone, attached housing in another, multiunit in a third, when in pre 1940 times it was common, at least in the core of the center city, to include apartment buildings in the mix, mostly small but of varying sizes--bigger in the core.

Armistra Apartments, Salt Lake.  Photo: Jonathan Mauer.

8.  It doesn't help that zoning rules also militated against carriage houses/accessory dwelling units, English basements, etc.  E.g., my DC block of 32 detached houses could accommodate almost that many carriage type houses.

Architects Melissa Shin, with dog Maya, and Amanda Shin enjoy the outdoor area in front of the ADU affectionately called “Mouse House.” (Ricardo DeAratanha / Los Angeles Times)

9.  Salt Lake City is interesting in that on residential arterials and corners of blocks, it's common to have duplex/triplex housing, and buildings with even more units depending on lot size.  

This type of housing, along with rowhouses, is often referred to as "middle housing" in that it is smaller than the larger SFH.

So this expands the variety of housing demographics able to be accommodated with different housing types.  E.g. a single tenant doesn't necessarily need a large house.

Another type of this housing is courtyard housing.  Salt Lake has a couple great examples including Boulevard Gardens.  A beautifully written book on creating modern courtyard housing is Pocket Neighborhoods by Ross Chapin.

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Click on the image for the full article.  Alternatively: link

As the article describes, it is absolutely true that segregated neighborhoods were a desired outcome from zoning.  

The author of the piece, Yoni Appelbaum, has written Stuck: How the Privileged and the Propertied Broke the Engine of American Opportunity, from which this is excerpted.  The book will be released by the end of the month.

For example, in the 1920s, parts of Upper Northwest DC were zoned against rowhouses, then the city's predominant housing type, to reduce the opportunity for racial mixing.

This isn't a blue-red state phenomenon per se.  The fact is that "red states" building more housing today is more a matter of timing than anything else, they are beneficiaries of having lots of land to develop still, because their growth has occurred after 1950.  And-- in response to demand for workers by the defense industry --the Sunbelt was really the Gun Belt (e.g., Anne Markusen).

One sign of this is how production home builders, such as Kaufman and Broad, originally based in Detroit, moved to Los Angeles.

Conclusion.  We are stuck.  Unless people gladly change their preferences to multiunit housing, it will be impossible to provide housing in central places, people will have to move further and further out from the core.

While zoning is one of the issues, market conditions (cost of land in particular) and people's housing preferences are the dominant forces.

Note that the movement to change single family zoning classes to include duplexes, and sometimes triplexes and quadraplexes as a matter of right could change the equation on this ("Planning Board recommends changes to allow more housing options in single-family home zones," Bethesda Magazine, "The YIMBY movement has a major win in Cambridge, even as many neighbors cry foul," Boston Globe), but only over very long periods of time.  Studies so far show that about 3% of housing tenure forms change per year in such situations, and that's pushed forward by the most motivated.

Mostly, individual property owners don't have the expertise to do this themselves, and will likely sell to developers to do so.  Whether or not properties sell at a premium to a straight up SFH house will be interesting to watch.

Las Vegas Mayor's Symposium on Urban Design (poorly marketed) | Missing Middle Housing

Suzanne saw this on Instagram (#mayorssymposium).  There's nothing on the regular Internet.  The focus this year is on infill housing, featuring presenters from other cities in the west.  The Instragram hashtag has links to slides on the individual sessions.

FWIW, these kinds of activities may help to assuage the opposition to such initiatives elsewhere, such as in Arlington County, Virginia ("Arlington lawmakers to consider a missing middle plan with no eightplexes," Washington Post).  

A sign opposing a zoning deregulation proposal known as “missing middle” on Jan. 8 in the Lyon Village neighborhood in Arlington. (Craig Hudson for The Washington Post) 

In community organizing/planned change, it's best to spend a goodly amount of time upfront to build the base of support for substantive changes to the status quo.

Dealing with this since the fall ("As housing prices soar, a wealthy county rethinks the idea of suburbia," Post) isn't enough time.

Salt Lake City has passed a similar change, up to four units.  

Corner duplex, with entrances to each unit on different streets, Salt Lake City.

And interestingly, infill housing could be done in a sensitive way, with restrictions on certain types of historic housing that isn't easily modifiable, because most neighborhoods have examples of existing small multiunit buildings (duplex, triplex, quads, quints, and small apartment buildings) that were sensitively done at the time the neighborhoods were constructed initially.

Many of the houses in Salt Lake are one story, so adding a story or two wouldn't be outlandish.  But the problem is if developers would be focused on creating four 2,000 s.f. units on one lot, which wouldn't work.

-- Missing Middle Housing website

Active initiative in Edina, Minnesota to preserve affordable single family houses | But why not build triple deckers?

KARE-TV reports ("Edina launches pilot program to save affordable homes from teardown") that Edina, a high demand suburb of Minneapolis, has instituted a program aimed at reducing teardowns, which replace smaller, older, more affordable houses, with what some call "McMansions," which are much larger, more expensive houses, often ersatz when compared to the size and architectural style of houses when the neighborhood was first built.

According to this article, Edina and a neighborhood in Minneapolis are the two hottest markets for teardowns in Greater Minneapolis (in the past in the DC area, Arlington and Chevy Chase in Montgomery County have been particularly hot markets for teardowns).

From the KARE-TV article:

Citywide since 2008, nearly 1,000 Edina homes have been demolished – roughly eight percent of the city’s single-family homes. The average value of Edina's teardowns: $421,420 The average value of the homes built in their place: $1,165,786. That’s an increase of increase of 177%. “It's something just so out of whack,” Ruth says.

There is an opportunity cost involved in two ways, either positive or negative, depending on your perspective.  First, teardowns up-price the housing in a community, reducing affordability.  On the other hand, when a local government is reliant on property tax for the bulk of its operating revenue, this process increases the property tax revenue stream.

In either case, teardowns are a form of "reproduction of space" that leads to significant community changes.

-- Edina Neighbors for Affordable Housing

Edina launched as a pilot a "Housing Preservation Program" focused not on historic preservation per se, but on the preservation of housing affordability (that's what "housing preservation" means in the public and social housing field too, not historic preservation).

Working with the West Hennepin Affordable Housing Land Trust, Edina will use funds generated from developer proffers and community development block grants to buy the houses.

From the article:

The city mailed more than 1,000 post cards asking the question, “Do you want to sell your home but not for a teardown?” The city ... make[s] funds available to buy a limited number of houses for their appraised values to assure those homes remain intact and with families needing more affordable options. “This is not a moratorium at all on teardowns,” Stephanie Hawkinson, Edina’s affordable housing development manager, says. “We are not mandating that anyone sells their home to us. We're just providing them with a choice.”

It will be interesting to see how this works, how much funding they have, and whether or not sellers are willing to sell to the city initiative, instead of extracting a somewhat higher price from the for profit real estate development market. 

Multiple units as an another alternative?  One of the forces "generating" teardowns is large lot size.  The lots appear to be large and can accommodate multiple families just as easily as a large house. Another way to increase housing access would be to allow "multiple unit" housing types on these lots.

I would say duplexes are "too small" given the rise in demand for housing given the constant increase in population.  So build triplexes and larger units ("Massachusetts Triple Deckers as "Missing Middle Housing" -- triplexes").

Minneapolis has changed its "single family zoning" so that duplexes and triplexes are "matter of right" as well ("How Minneapolis Freed Itself From the Stranglehold of Single-Family Homes," POLITICO).  

My criticism is that relying on individual property owners to take the initiative means that it will take decades to see much effect ("A short point about why eliminating single family zoning won't result in a rise in "affordable housing" (any time soon)").

This Boston double triple decker, now four separate units, rather than six, is for sale for $1.4 million.

By contrast, creating an active housing conversion/building program comparable to the Edina program would be a way to generate a greater number of units more quickly.

Although in the short run, it won't yield housing that is newly affordable without subsidy, because it is built at current costs for land, labor, and materials. 

Massachusetts Triple Deckers as "Missing Middle Housing" -- triplexes

A triple decker is a three unit, three story residential building.  They are pretty common in Massachusetts communities such as Boston, its suburbs, and outstate cities like Worcester.  There are regional differences in the name, in Worcester they're called "three deckers" 

According to "Q & A: The Triple-Decker: New England Icon," today's zoning codes have made such types illegal, with too much density compared to current allowable ("MASSACHUSETTSThe Rise, Fall and Rebirth of the Triple Decker," New England Historical Society, "What Happened to the Three Decker?," MIT Masters thesis).

So long before recent times, affordable housing types (including SROs and rooming houses) such as the triple decker were outlawed.

Two triple-deckers that were recently renovated with energy efficiency in mind on Stanton Street in Worcester. (Robin Lubbock/WBUR)

This triple decker in the Dorchester neighborhood of Boston is being renovated for a future season of the "This Old House" television show on PBS.

In 2012, comparable to Chicago's support program for bungalows, and Toronto's Tower Renewal Program for high rise residential buildings, Boston created a small financial support program for triple deckers ("City moves to preserve iconic three-deckers," Boston Globe).

A triple decker is as if a DC rowhouse was built as three separate apartments, one to a floor.  The Boston version has three reasonably commodious units.  They can be converted into condos, or managed as three apartments.  Some "triplexes" in Worcester have been divided into as many as 18 units.  (I seem to recall a form in Cleveland that is the equivalent of two side by side triples as one apartment building.)

Sometimes the owner lives in one unit and rents out the others, making rental income to pay off the mortgage.  This is common for Montreal's five unit plexes (below) also--the owner lives in the larger unit on the ground floor, and rents out four units, two on each floor, above.

Massachusetts is running a competition to come up with ideas for weatherization and other improvements ("A Triple-Decker For The 21st Century: Airtight And Solar-Powered," WBUR-FM/NPR), "Triple-deckers can rise again for the 21st century," Boston Globe).

40% of greenhouse gas emissions come from existing buildings, so energy weatherization is an important element of GHG reduction planning.

A new-fangled take on old New England housing, the UMass Amherst submission that won "most innovative design" in the state's recent triple-decker design challenge. (Courtesy UMass Amherst)

The firm featured in the NPR story started renovated buildings in Worcester when the cost to buy a building was much cheaper.  Now that housing prices have escalated the firm says subsidies would be required to do the kind of full scale energy retrofits.

Also, in today's set of building code requirements, the houses are treated as commercial buildings, and therefore have more stringent requirements, including disability accommodations and fire suppression, making them more difficult and expensive to construct.