Napa Co. Will Waive Loans For ADU Units Rented Below Market Price

NAPA COUNTY, CA — Loans on granny units will be forgiven in Napa County for homeowners who rent them at below-market rates to people who earn less than the region's median income, officials announced Tuesday.

The Napa County Board of Supervisors approved the measure to support the creation of accessory dwelling Tuesday, calling the passage a major step forward in the development of affordable housing in the county.

The measure is meant to "help homeowners build vital new affordable housing for local families and workers within our community," Chair of the Board of Supervisors Ryan Gregory said in a statement.

The program will also provide homeowners with ADU education, a feasibility consultation and technical assistance managed construction escrow services and even tenant selection, the county said in a news release Tuesday.

Eligible homeowners have an opportunity to receive the following loan incentive amounts: 45,000 for a studio, $80,000 for a one-bedroom unit and $105,000 for a 2-bedroom unit.

Loans are available to Napa County homeowners who will be subject to an affordability covenant for the rental term of five years. For each year that the borrower participates in the program, 20 percent of the loan will be forgiven, including interest.

Homeowners must rent to households earning at or below 80 percent the area median income for no less than five years, officials said. In NAPA COUNTY, the median household annual income in 2020 was $92,219.

The program is set to launch in January, 2023.