 Hey, good evening good evening or good afternoon. Good morning. Whatever it is Hey, hi everybody, how you doing Russell Moore coming to you from dedicated to financial literacy again Please hit the subscribe button the bell if you want to be notified for content in the future This channel I really established it for my friends and I had a couple of comments from people that are that I didn't know Saying that they like my content and you know gave me some tips saying you know editing and quality of video Just things I need to work on but I didn't do any of that stuff because I wasn't really Planning on I mean, I'm not even to this day. I'm it's not about money or ads or anything like that I'm not trying to impress anybody. It's really I care about people and I want them to learn and know What I know, you know when I learned something I'm gonna give it to somebody and that's basically it. That's the heart of this channel, you know I'm dedicated to financial literacy now. You guys know my favorite saying I say this all the time and I start off my channel. I start off my segments with this and that is you will not earn if you do not learn and Then I say this as well If you don't read you won't lead all right, so That's the heart of my channel. So anyway today I want to just jump right into this and usually I try to keep my videos around anywhere between 10 and 15 minutes So I'll probably do two videos on this just on this segment. So I Want to talk about ad use accessory dwelling units ad use now What is an ad you first and ad you basically is an additional Property or additional dwelling unit on your properties. So say you have a home and You have a garage that's 300 to 500 600 square feet Did you or did you not know and I've went around asking a lot of people. Hey, what's an ad you and Many people don't know It particularly in the in the south south LA Particularly in south LA when I talked to a lot of my peeps They're like what I don't get it. What's an ad you I said, do you have a garage? Yes, I have a garage a big garage. I said, well, didn't you have an ad you you have a potential to have a dwelling place That generates income for you and And not many people know that and not and the laws that have come out the particular bills that I'm going to go over with you has enabled us To acquire this Acquire this so not only do you become a home a home home a home owner But you can turn your garage and convert it into a residence And the cost will shock you It's not it's not it's I'm not saying it doesn't cost at all but it's not it's doable and and once you do it the value of your property will go up You've got a renter so you can get cash flow from it or Even if you don't get the cash flow You got somebody helping you pay for the mortgage you stay in one home. You rent out your second one That's the premise of ad you why are these so big right now? And the reason is that if you've heard Gavin Newsom Our governor has been getting a lot of heat concerning the homeless issue So as a result a response because he's like, oh, I don't He's going to get recalled. He deserves it. I'm sorry. I'm sorry my people Gavin Newsom needs to go. He needs to be recalled. But that's not what this is about Anyway, let's get back to and I will say this. This was a good thing He has signed five bills that I talked to me. I've talked to multiple people. I'm talking about people that That are of higher learning education and just smart Smart people. I'm not talking about just the any-day person on the street I'm talking about intelligent people that have and I'm not saying that people on the streets are not intelligent. Listen to me I'm just saying here's my point I've talked to people of all walks of life and many of them have no idea that in california right now There have been five bills that have been signed to assist us and help us financially If you own property now the reason why I'm highlighted in south la Let me tell you why I grew up in south central la and one of the things about the homes in south central la Is many of them were built As far as the 1920s to 30s to 40s to 50s 60s. Okay But many of these homes They built large garages. So here's the issue with that The structure and the foundation is already there So half your construction or what they call your hard cost Many of that many of those if you purchase a house in la south la Is already done So guess what that's reducing your cost when you build an additional unit And i'm talking about building another house These garages are big enough for you to build another house. Some people are building one bedrooms two bedrooms three bedrooms Units with second stories And it's already in place Okay, that's a great value. What why is that important? Well, if you own a home And you say many of these people in south la they've been paying for years Many of them are almost finished paying them paying them off or they have paid them off And they have this garage that's sitting there that could be generating income because if they convert it to an adu They can rent it out and get extra income And get this what if they decide okay? I'm going to move out of my house and rent both of them out Live double up with a couple live somewhere where you're not paying a much rent and now you've got you've got income property You got income property. This is the purpose of the adu now Let me go over this because i'm going to do another segment on this talking about Cost of adu's and all the different things that you got to do to establish the adu But let me give you these five bills. Please write them down and go and read remember You you will not earn if you do not learn So here here are the five bills that have been signed in california most of them are good until 2025 Okay, and i'm going to briefly go over over the bills Okay Number one is bill ab 881 ab 881 google number two ab 68 ab 68 Number three ab 670 ab 670 Number four ab 671 ab 671 and last sb 13 Now most of these Most of these were signed because remember the homeless they're trying to get they're trying to deal with this homeless situation Well, if people that have homes There are many homes throughout south l.a. And you take that garage and convert it now say your garage is too small Or you don't you don't have a garage It's rare to find a house in south l.a. That does not have a garage But most of the properties are so large that you can build one from the ground up Most ad use most ad use Construction companies you can you can actually have one built as low as 40 thousand dollars So here's this person that has a home and has a garage They can convert that to another house because they have a foundation because they have the structure They have walls and everything they haven't you know, it's just a matter of converting it And many of them can do it for 30 to 40 thousand A good high-end one is going to cost you about 70 to 75 thousand Some people have gone up as much as 100 grand, but here's what happens once the ad u is built It's built now. You've got two homes On that property now say you purchase that property property Because remember south l.a many of the homes are older Many of them are older Many of them are older. So it's going to take some work probably even in the front house Okay But you buy the house for 450 500 grand You build the ad u now you got two homes on the property And then your property ends up going up to about seven eight to 800 thousand The property value goes up when the ad u is built the property value goes up And because others are doing it in the neighborhood the whole neighborhood the property value is starting to go up Then you rent it out You rent it out Do you know how high expensive rent is is nowadays? I've been doing go to rent o meter dot com rent o meter Check out how much the rents are In california and growing There's a latest study that came out that said we are beginning to turn into a renters nation Watch out for that term renters nation And they're saying that the people that do not own property With additional income that they're making from that property Are going to be in trouble in the next next five to ten years So why am I saying this? This is a good time why the rates are low So my wife and I we've been looking we've been looking here in la Even in where we are now we we're you know, we're preying on where we're going to be But we want to get a home with a garage and here's the average get this the average size for a garage Okay, the average size for a garage In la is between 400 and 600 square feet. They are absolutely massive All that my realtor is telling me yeah, russell nobody knows about ad use I said, I know this is crazy And what's happening? Here's the sad part a lot of investors out of the country out of the state Are buying la houses in south la and here's what they're doing. They're converting the garages Or what they'll do is they'll remodel redevelop the front house And then raise the price Encouraging the person to buy To hey, you got an adu back there buy this house for 750 you can convert it to an adu and rent it out And it'll pay most of your mortgage Why aren't we doing that Even if we have to crowd invest a crowd pool, you know Crowdfunding they call it where you get together a bunch of people and buy a property convert it Now you've got income property I'm not suggesting that we do that. I know this this this this channel this channel has been made mainly for my friends But I'm not saying that but I know I I'm going to get in on this The rates are low you purchase a home You convert that garage to an adu now you've got two homes And you've paid what okay? A total of what seven seven hundred thousand But you got two homes you rent out the other one you rent out the adu you it's gonna rent It's new it's brand new everything's new new fixtures new flooring New bathroom new kitchen new cabinets Here's what they're saying make sure you have plenty of storage if you build an adu. I want to plug throw that part in there Okay, now I've given you the advantages Well taxes that look your taxes won't be affected that much On the adu The value of your property just went up. You got renters helping you pay for your mortgage. So instead of you paying 1800 $2,000 for that apartment you're living in or the house that you're leasing My wife and I our renters going up to 2,500 where we live We're in november. We're gonna be paying 2,500 for a lease And that's cheap where we're at Most of them are going for 3k for a three bad three bedroom Here's another advantage say your house is fixed up. You get your house fixed up along with the adu Well, if you got a three bedroom home, you can rent out the home and live in the adu that that's a one bedroom or two bedroom So they're paying what three three over $3,000 the people in the front you're in the back They're paying three grand 3,200 for the home for your which is going towards your mortgage Well, your mortgage for $700,000 mortgage. It's not going to be no more than about 3,500 and you got people almost paying three grand Your your rent will be about five to six hundred dollars Now you're a homeowner not only are you a homeowner you own an adu. So if you got income property And you're not under that weird tax bracket because you're not exceeding four units All right, I mean, it's a win-win you guys Now the area in which you choose your adu does matter and the great thing about it. I'm a resource I grew up. I know where all the gains are. I know where the issues are. I know where it's not safe And so I told my wives look I know where it's not safe And then who says you have to stay there You get the adu stay there a year and a half move out. Now you're renting out both properties And one of them is probably going to be paying or almost paying for the whole thing for your whole mortgage So now you got cash flow take your equity from that and go buy something else where you want to live You guys I'm trying to encourage you I'm I'm gonna make it's gonna happen. God's gonna do it. God's gonna do it. That's the key God's got to do it for you. All right So, all right, so let me go over these bills real quick and I'm gonna close. I'll do another segment 671 is based on it's really a bill that was signed for low income for adu It makes it easier for low income families to get in All right the 881 and 868 is kind of the same it it takes away the restrictions for example three bedrooms I mean three three units You could not in la could not have three units without major opposition from the municipalities They've done away with that Not only could you have one adu you can have up to three. Here's another thing Well, you can do more if you have more square footage. Let me put it that way But here's all I'm saying the adu's on You can have up to three without all of the restrictions that were there And here's the thing Before these bills were signed you could not go up to the property line building You had to stay a certain certain amount 10 15 20 feet on each side That you could not go up to the property line Now you can go up to four feet of the property line. Why is that important? Now you can get a larger adu There's no restrictions. You can use more of your property All right 68 It's for land use And I just went over that so look up 8 81 ab 8 81 and 8 68 It it streamlines the process 888 8 i'm sorry 8 81 Streamlines the process between the municipalities they would go over 120 to 160 days to approve your adu that is no longer the case. They have to give you an approval or disapproval within 60 days But they're making it it's so much easier to get approved now because of the homeless situation They're trying to do something, you know quickly to say hey, we're doing something about the homeless So you're going to get approved for most adu's in south LA because the structures were built to such a way That they were already approved and zoned and permitted Now you may have some that you have to you that's why before you buy a home make sure that garage That is it's adu approved. That's all you got to do is check with the city Check to see is my garage adu approved ask your realtor do not buy one Unless it's adu approved now Even if it isn't the way the laws are now the the the bills that have been passed You can get it you can get it approved pretty quickly and easily There might be something that happened with the structure. They could be something going on with the cement There could be something that's going on Electrical could be off or something going wrong with electrical And here's another key and many of the garages that were built in the 1900s in south LA already have electricity So some of that electrical work that the construction people will have to do they won't have to do that now they'll have to do the plumbing But look at how much money you can save. All right, a b uh sp 13 Man, this is a good one fees and removing of more restrictions Impact fees, which is thousands of dollars if you build an adu 750 square feet and below In your backyard at that garage, there will be no absolutely no impact fees And like I said most of the garages are like Between 350 and 600 square feet in LA So everybody's gonna be Will benefit from that from sp 13 no impact fees Which is thousands of dollars when you're building an adu. What's your impact fees? It's the fees that they just pile on to build your adu The city builds you all the impact fees what i'm saying is no impact fees and this is good until 2025 Okay, that's gonna save you thousands of dollars on building an adu. All right, kevin and kevin and nicole You got a garage. That's your adu Here's another thing even if you don't have A built adu if you're rent if you're an owner and you're renting your home Do you know that you can apply for some adu benefits? Look it up. Look you got look it up. Okay And i'm telling you this is these have been signed Gavin Newsom signed these into Existence these laws exist Um, I went over 671 ad uh 881 670. Oh 670 670 tackles the hoa issue many hoas will stop have been stopping adus for years You want to build an adu on your property? For example, uh, we're past our my pastor and my pastor and his wife live They have a garage in their front house They can convert that now without any opposition from their hoa if they wanted to See for years the hoa would say no you can't do this you can't do that you can't do that They're lifting restrictions. So this law right here this ab Assembly bill 670 tackles homeowners associations. They can no longer keep you from building an adu That's great news you guys for those that have a hoas that are coming against you to keep you from building and constructing A new a new unit on your property Wow We went over 68 we went over 13 look up these bills Okay, that's it for now. Oh man. I went 20 minutes. I try to keep it to 15, but Uh, I got more to say about this, but I just want to say to all my friends. Hey, let's jump in Let's get in especially those of us who do not have homes yet. All right All right, I'm gonna say more about this. Okay, maybe we can have a zoom call. All right Have a wonderful day everybody keep prospering. God loves you. I love you We're all that in a bag of chips, but not without him. All right. Bye. Bye You