ECHO Housing (Elder Cottage Housing Opportunity)


Elder Cottage Housing Opportunity, Accessory Units, Granny Flats refer to a housing opportunity for seniors to share a single family home or a separate apartment, or rental unit, on a single family lot, with another person or family. The owner of the home and lot may be the senior, or the sharing, or renting party.

Historically the main home was occupied by a family and the rental or smaller ECHO unit was where a mother or mother-in-law lived.

Today, some communities (i.e.in California) don't specify the relationship between the main home occupants and the occupant of the smaller unit. The smaller unit may be an apartment carved out from within the senior's (or family's) home with a private entrance, be above a garage with separate entrance or be free standing. The municipality may allow second units to encourage the increase of affordable housing units within their jurisdiction of predominently middle to upper priced, single family homes. In those cases a renter may enjoy "affordable" rent in exchange for helping with chores. A market rate apartment unit added onto the lot of a seniors' home may generate enough cash flow to help a "house poor" senior make ends meet.

Typical "Granny" or "Mother-in-Law" flats may work in reverse, with the small apartment that shares the lot with the single family home is rented to a senior, historically, a related senior. Some regulations include expiration clauses activated when the senior dies or when or if rents are raised from "affordable" levels, to market rate.

Interested in pursuing the ECHO housing idea further? Below we extract from 3 articles which appeared in the seniorresource.com E-zine outlining the process in greater detail.

See our archive of articles on senior housing at E-zine.


ECHO HOUSING - A Multi-Generational Solution

Different zoning ordinances permitting a second unit to be built, installed, or "carved out of an existing home" will use various names to mean a second living unit on a single family lot. All cities and counties do not permit a second unit on a single-family lot. Rural communities may permit them, cities looking to increase their "affordable unit" numbers, and vacation communities may allow them. All cities in California are required to permit them. If you want to use an ECHO unit to move your parents closer to you, but not have them live in your home, start by checking if a second unit is legal in your jurisdiction, within your zoning.

A "legal" second unit usually means there is at least one separate entrance, a bathroom and a means of cooking. With one entrance, and not two, cooking may be restricted to a microwave and a two-burner cooktop.

Other variations on the theme of a second unit, are how they are achieved. The original ECHO units (conceived in Australia) were a mobile, or modular, rental unit moved onto the property. The "mother-in-law" moved into this totally separate "apartment". Upon her death the modular apartment would be removed. The company who owned the unit would then rent it to another family somewhere else.

Some US communities allow the placement of a second temporary unit on a single-family lot. Others require that the unit be built on site, others specify that it must be attached to the main home, or that it may be detached. If stick built, it is usually permitted to be functional after the departure of the original resident.

In some communities the resident of the ECHO unit must be at least 62 years of age and be a relative. In California where a state regulation requires every city to have an Accessory Unit Ordinance, we see much variety in the mandated profile of the resident. Cities looking to increase their affordable stock regulate the rent amount, not the relationship of the renter to the property owner. Others specify age and/or relationship. Others do not specify the profile of residents, but control who can develop a second unit by high development fees or specifying a large minimum unit size. Set backs, minimum size, and high fees can preclude the average middle income homeowner from developing a second unit on their single-family lot. These regulations may not deter the wealthy who have large lots and money. They may be added as maids quarters, or guest cottages.

In considering adding a second unit to your property, know why you want one and what you hope to accomplish in the short term, and perhaps in the longer term. The next step is to check the zoning and related ordinances in the building and/or planning department of the City or County to see what is and is not permitted, and if the parameters of the regulations (setbacks, squarefoot minimums or maximums) will allow you to achieve your goal by adding a second unit. Then check the steps you will be required to go through; what reviews and approvals you will need to get before you start to build, or contract for that "apartment".

ECHO HOUSING - A Multi-Generational Solution

Once you have checked the zoning and any Covenants, Conditions and Restrictions (CC&Rs) that may apply in your particular development's community association, and know you can legally proceed, you are ready to address details to go from idea to plan.

From the zoning regulations you know lot setbacks - front- back- and side-yard footage requirements - minimum unit size, roof line height limits and if the "apartment" can be a permanent addition to the lot, or only temporary. If it must be removable when its useful life in your family is over, then it will be a mobile or modular unit, and the division of rooms and amenities may be predetermined by the company that manufactures or provides the modular unit.

Either way, it is important to address the function to assure that the finished "apartment" will meet the needs for which it's intended.

  • What is the age of the expected occupant(s)

  • Are stairs expected to be a problem over time?

  • If there must be stairs to get to it and the unit just must be over the garage, can a stair rail elevator work with your plan?

  • How many people will live in the "apartment"?

  • Will the minimum permitted square feet provide enough space, or will you need to build a bigger unit?

  • If for a couple, will they sleep in twin beds? Two beds require a longer "headboard" wall span than does a double, queen or king bed.

  • How many rooms will the occupant(s) need?

  • Will they need room to eat in the kitchen?

  • Will they need a separate living, or sitting room?

  • Will a studio"apartment" layout work?

  • Based upon zoning regulations will there be a stove with an oven, or a cooktop and microwave?

  • Based upon the lifestyle of the occupants will these criteria work?

  • Will the apartment occupants and you want privacy in coming and going, so that the exit door should face away from the main house?

  • Should it face away from the yard of the main house?

  • Will the occupants lend a hand with caring for children, so that a view of your yard from the unit is desirable?

  • How much storage will be needed?

  • Will extra parking be needed on site to be provided for the "apartment", or is there sufficient on-street parking, and is it permitted on your street?

  • To find enough square feet on the lot does the"apartment" have to be attached to the main house?

  • If the "apartment" is attached, can it share space with the main house, like a bathroom?

    With a rough size and tentative location for the ECHO unit you are ready to locate a contractor or architect to produce plans for the unit and the site placement. These are what the construction contractor will work from.

    If the unit is to be modular or mobile you will need to contract with a company that handles such units. Whom ever you contract with, should be chosen with the same care you would select anyone who will work in your home. Check them out with the Better Business Bureau. Check out contractors with the state contractors license board to verify they are licensed to perform the type of work you need. Find out if there have been complaints against them. Be sure they have liability insurance and workmen's compensation to protect you and your home. Do they have experience in ECHO, or accessory unit, housing? Ask for references and call at least three of them. You might even want to visit the completed jobs to see for yourself. They may be satisfied, but.... Their insights may or may not be of concern to you.

    Questions you might want to ask are:

    - Are past clients happy with the finished product?
    - Was it completed in a timely fashion?
    - Were workmen courteous and neat?

    To find a licensed contractor you might check with local architects for referrals, and check with your bank or savings and loan - they often have a list of reputable contractors their clients have dealt with in the past. Always use a licensed contractor. Any money you think you might save using someone who is unlicensed is risked because you do not have the same legal rights against an unlicensed contractor.


    If you are going to pay cash for ECHO or second unit, or pay for it as a monthly rental, (only applicable to modular units delivered in a completed state, and removable when your need for the unit is over) then you won't need to shop for financing. If not, than you need to decide how best to finance the project. Don't wait until too late in your planning process to shop for financing. Funding limits may have an influence on your finished product, or if you can proceed at all.

    Among your financing options are:

    - Refinance of the present mortgage.
    - A home equity loan.
    - A second mortgage.
    - A home equity line of credit.
    - Reverse mortgage.

    In shopping for financing, remember that some funding options tied to your home mortgage may be income tax deductible.

    Incremental draws against the loan amount, for payment to the contractor are the norm, as is a hold back of 5-10% on each increment of work that triggers payment to the contractor. Your goal should be to retain sufficient money against the work still to be performed, not to be caught short of money should there be a problem with the contractor and job completion.

    If your funding is from your bank they will be able to help you structure your loan draw and contractor payments to protect you from making payments that put you ahead of the work performed.