Long Beach: City Announces Second Round of Backyard Builders Loan Program to Help Lower-Income Homeowners Build ADUs

Long Beach, CA ~ Long Beach, CA - The City of Long Beach has announced the launch of the second round of the Backyard Builders loan program, which aims to assist lower-income residents in financing and building an Accessory Dwelling Unit (ADU) on their property. This program, which will open for applications in Summer 2026, follows the success of the first round that was launched in 2024.

Mayor Rex Richardson expressed his excitement for the second round of Backyard Builders, stating that it will "transform more lives" by providing homeowners with the opportunity to create additional living space for family members or renters. The program offers income-qualified Long Beach homeowners a loan of up to $250,000 with a below-market interest rate of 2%. Payments on these loans will be deferred until the end of the 30-year term or until the property is sold or transferred to another owner.

The second round of funding will finance at least 16 ADUs, an increase from the 10 units funded in the first round. In addition to financial assistance, homeowners will also receive project management support at no cost to guide them through the design, permitting, construction, and leasing processes.

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To be eligible for this program, applicants must own and occupy a single-family home within the designated program area and meet the State's definition of lower-income. The income limits for 2026 have not yet been released. Other factors that will be considered include debt, mortgage and property tax payments, and maintenance of homeowners insurance.

The full requirements, guidelines, and loan details will be available on the program webpage when applications open in Summer 2026. The Long Beach Community Development Department will also host online and in-person information sessions to provide further details about the program and answer any questions.

Funding for this second round comes from a $4.8 million award from California's Department of Housing and Community Development through its CalHome Program. The Long Beach Community Investment Company (LBCIC), the nonprofit arm of the City, will administer the loans.

In the event that there are more qualified applicants than available loans, a randomized lottery will be conducted to determine recipients. Christopher Koontz, director of the City's Community Development Department, highlighted Long Beach's leadership in ADU development and stated that this program will continue to expand housing options for residents.

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The second round of Backyard Builders builds upon the success of the Pilot Program launched in 2024, which was open to all homeowners without income restrictions. However, this round is specifically designed to support lower-income homeowners who will be encouraged to rent their ADUs to tenants using housing vouchers from the City's Housing Authority. This flexibility allows for multigenerational living, reducing overcrowding or providing an additional income stream. Short-term rentals are not allowed, and cash-out refinancing against the loan is prohibited.

Homeowners who have already begun the ADU design and construction process may apply for this program at any point before receiving a Certificate of Occupancy. However, costs incurred before executing the Backyard Builders loan will not be reimbursed by the City.

For more information on this second round of funding for Backyard Builders, interested individuals can visit longbeach.gov/aduloan and sign up for program updates. These updates will include information on community information sessions, application periods, and notification periods. The City encourages community members to take advantage of this opportunity to improve housing availability and affordability in Long Beach.

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