Now facing an ugly housing crisis, San Diego has rediscovered the granny flat, also called companion units or by their more formal name, accessory dwelling units.

Granny flats are secondary housing units on single-family residential lots. At the end of April, the San Diego City Council voted unanimously to waive fees associated with their construction.

“Companion units provide a housing option in the city that we desperately need," said Council Member Scott Sherman, who supported the move. "We've moved one step closer to increasing the number of these units by reducing the burdensome fees.”

Gone are impact fees, facility benefit assessment fees and general plan maintenance fees for the construction of granny flats. The thinking is that this will help spur their construction.

The housing shortage is more than a matter of affordability, though that is a critical issue. Rather, San Diego is facing a shortfall of dwelling units in absolute numbers.

A new report by the San Diego Association of Governments says the region needs to add about 171,000 new residential units — houses, condos and apartments — by 2029, based on projected population growth. That is a pace of roughly 17,000 units a year, something San Diego County hasn't seen since 2003. In 2017, the county authorized about 10,000 new units.

The three barriers to building companion units are regulatory ordinance barriers, excessive fees and difficulty permitting, Sherman said.

"The city has already tackled the ordinance, now it's tackled fees, and the only task left is to make it easy for San Diego to build these units.

"In the near future I will bring forward a companion unit toolkit providing three different designs that will help homeowners easily navigate the development process to achieve our goal of 2,000 to 6,000 new units over the next 10 years.”

Besides the waived fees, Mayor Kevin Faulconer also directed $100K to the Public Utilities Department to cover the cost of water and sewer capacity fees for granny flats for the remainder of FY 2018. The mayor also plans to commit an additional $300K in the FY 2019 budget to cover additional fee waivers designed to increase granny flat supply.

The movement to support ADU construction is more than a local issue.

"I believe that ADUs are going to become very mainstream in the next two to five years in major U.S. cities," said Kol Peterson, an ADU activist based in Portland, Oregon, and author of "Backdoor Revolution — The Definitive Guide to ADU Development."

"The tiny house movement has popularized small housing since around 2013, and this popularity also contributes to the consumer interest and appetite for ADUs. Though ADUs have been around for quite some time, recent California state legislation has helped popularize them."

The most recent legislation at the state level, effective at the beginning of this year, allowed ADUs to be built concurrently with a single-family home, opened areas where ADUs can be built to include all zoning districts that allow single-family uses, and modified fees from utilities, such as special districts and water corporations.

The necessity for additional infill housing development, evident as an acute housing crisis especially in coastal U.S. cities, is the driver that is moving municipalities to consider ADUs more seriously, Peterson said.

"As the ‘missing middle housing’ concept is popularized among planners and designers, ADUs are poised to present the most viable stepping-stone solution for cities that are experiencing a housing crisis, and exploring how to increase housing opportunities within their single-family residential zones," Peterson said.