Long Beach will open applications next month for the second round of its Backyard Builders loan program, which will provide up to $250,000 in financing to help lower-income homeowners design and build accessory dwelling units on their properties.
The 30-year loans will be offered with a below-market interest rate of 2%, according to a press release.
Payments will be deferred for the life of the loan, city officials said, meaning most borrowers will not have to make any payments until the 30-year term is over, or until the property is sold or transferred to another owner.
The application window for the second round of the loan program will run from Nov. 1 to Nov. 31, officials said.
To kick off the application period, Mayor Rex Richardson and city leaders held a press conference last week outside one of the newly completed ADUs from the first round of Backyard Builders loan recipients in East Long Beach.
“The Backyard Builders program is a prime example of innovative housing solutions here in Long Beach, which has been a statewide leader in ADU production,” Richardson said in a statement. “Round 2 of this program broadens the benefits of ADUs to include lower-income families who can use the space in so many ways – to relieve overcrowding, generate income or perhaps provide a safe place for a grandparent to live close to family.”
The mayor, during the Wednesday, Oct. 21, press conference, attributed Long Beach’s success with ADUs to the Backyard Builders program, which provides homeowners with pre-approved plans and designs and affordable financing, and contributes to affordable housing efforts through the city’s local housing choice vouchers.
The second round of the program is expected to finance the construction of at least 16 ADUs – up from 10 in the first round of Backyard Builders funding that launched in fall 2024 – and provide project management assistance at no cost to homeowners, guiding them through the ADU design, permitting, construction, and lease-up processes.
From left, Housing & Neighborhood Services Bureau Manager Meggan Sorensen and Mayor Rex Richardson tour a newly built ADU in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
From left, Mayor Rex Richardson speaks with Jonathan, Alina and two-year-old Lyudmila Lopez who are one of the first recipients of a Backyard Builders loan in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
The newly completed ADU of Alina and Jonathan Lopez, who are round one Backyard Builders loan recipients in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
Mayor Rex Richardson speaks during a press conference to kick off the application period for the second round of the Backyard Builders ADU loan program in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
Mayor Rex Richardson speaks during a press conference to kick off the application period for the second round of the Backyard Builders ADU loan program in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
The newly completed ADU of Alina and Jonathan Lopez, who are round one Backyard Builders loan recipients in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
The newly completed ADU of Alina and Jonathan Lopez, who are round one Backyard Builders loan recipients in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
The newly completed ADU of Alina and Jonathan Lopez, who are round one Backyard Builders loan recipients in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
The newly completed ADU of Alina and Jonathan Lopez, who are round one Backyard Builders loan recipients in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
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From left, Housing & Neighborhood Services Bureau Manager Meggan Sorensen and Mayor Rex Richardson tour a newly built ADU in Long Beach on Wednesday, October 21, 2026. (Photo by Drew A. Kelley, Press-Telegram/SCNG)
Interest in the program is expected to be high, with more than 400 applications submitted the first time, said Meggan Sorensen, Housing and Neighborhood Services Bureau manager in the Community Development Department. If the number of qualified applicants for the second round of Backyard Builders exceeds the number of loans available, the Housing and Neighborhood Services Bureau will enter all eligible applicants in a randomized lottery to determine loan recipients.
“This program is an excellent reminder that expanding housing options in Long Beach can come in so many forms,” Christopher Koontz, director of Community Development, said in a statement. “We’re working to address the housing crisis in so many ways, but Backyard Builders is a particularly exciting path toward smart, flexible and fundamentally livable homes for our residents.”
This new round of funding comes from a $4.8 million award from the California Department of Housing and Community Development through its CalHome Program, according to a press release. The Los Angeles County Affordable Housing Solutions Agency also provided an additional $315,000 to provide design and project management assistance to participants.
The Long Beach Community Investment Company, the nonprofit arm of the city that was formed to help address housing availability and affordability in Long Beach, is the recipient of the grant. Backyard Builders loans will be administered by the LBCIC, officials said.
Round two builds on the success of the city’s pilot program, which was open to homeowners without income restrictions. Homeowners in the first round were required to rent their ADUs at an affordable rate to low-income households.
For recipients Jonathan and Alina Lopez, participating in the program meant building a lasting asset for their young children in the backyard of their home and opening the door for someone to have a home in Long Beach.
“We wanted to take steps to create affordable housing where our kids live,” Jonathan Lopez said during the Wednesday event. “I think one of the big controversial things with ADUs is that people are afraid it’s going to change the character of the neighborhood. So I would advise anyone to really make sure the ADU fits the neighborhood; I think this blends right in.”
The second round is specifically designed to support lower-income homeowners, who will be encouraged, but not required, to rent their ADUs to tenants using vouchers from the city’s Housing Authority, officials said. This flexibility allows the ADU to be used to generate additional income or to house extended family, among other uses. If the ADU is rented, it must be leased for a minimum of 30 days; short-term rentals are not allowed. Cash-out refinancing against the loan is prohibited.
To be eligible, applicants must own and occupy a single-family home in the designated program area and meet the state’s definition of lower-income. For 2026, the maximum annual gross household income limits are:
1 person: $93,300.
2 people: $106,600.
3 people: $119,950.
4 people: $133,250.
5 people: $143,900.
6 people: $154,600.
7 people: $165,250.
Other eligibility factors include applicants’ debt, payment of mortgage and property tax, and maintenance of a homeowners insurance policy, the city’s press release said. Funded ADUs must be less than 500 square feet, single-story and at ground level. Full program requirements, guidelines and loan details will be available on the program’s webpage.
Homeowners who have already begun the ADU design/construction process may apply for the program at any point prior to a certificate of occupancy being issued. The city, however, will not reimburse homeowners for costs incurred before the Backyard Builders loan is executed, officials said.
Three community information sessions are scheduled to offer residents more information about household income limits and other program criteria. The sessions will take place on from 5:30 to 6:30 p.m. Tuesday, Oct. 27, at the Michelle Obama Neighborhood Library, 5870 Atlantic Ave.; from 6:30 to 7:30 p.m. Nov. 5 via Zoom; and from 10 to 11 a.m. Nov. 14 at Cesar Chavez Park, 401 Golden Ave.
To RSVP for sessions or learn more about Long Beach’s Backyard Builders loan program, visit longbeach.gov/aduloan.