Why Lakewood Has the Most ADU Potential in LA County Right Now (A Buyer's Guide)
If you're an investor or owner-user looking to buy a property with real ADU upside, Lakewood deserves to be at the top of your list — and most buyers still aren't looking there.
Here's why that's about to change.
The Price Point Opens the Door
The median home price in Lakewood sits right around $865,000–$870,000. For LA County, that's a meaningful entry point. You're getting into a well-established residential neighborhood — one with wide lots, mature streets, and strong rental demand from Long Beach workers and South Bay commuters — at a price that leaves room in your budget to actually build.
Compare that to markets like Culver City, Torrance, or even parts of Long Beach proper, where you're often paying $1.1M+ just for the dirt, and the math on a second unit starts to get thin. In Lakewood, the price-to-rent ratio still pencils. That's rare in LA County right now, and it's exactly the window that serious ADU investors know to move through before it closes.
If you're still figuring out how to search for homes with real ADU potential — what lot characteristics to prioritize and what to pass on — the same framework applies in LA County markets like Lakewood.
The Garages Are the Play
Lakewood was developed in the 1950s as one of California's original planned postwar suburbs. What that era of construction left behind is a gold mine for ADU investors: detached garages.
Most Lakewood single-family homes sit on lots with a freestanding garage at the rear of the property, typically accessed from a side drive or alley. That configuration is exactly what the California ADU laws were designed to unlock.
You have two strong paths here:
Path 1: Convert the existing garage. Garage conversions are one of the fastest and most cost-efficient routes to a permitted ADU. California state law prohibits cities from requiring setback variances or additional parking when you're converting an existing structure — meaning Lakewood cannot require the garage to meet new setback rules just because you're changing its use. That protection alone removes one of the biggest approval obstacles investors face in other cities. We've broken down exactly how setback rules for garage conversions work under state law — and same-footprint rebuilds qualify too.
Path 2: Demo the garage and build a detached ADU. This is often the stronger play. A new construction ADU can be sized more deliberately, built with better insulation and layout, and command meaningfully higher rent than a converted structure. Because Lakewood's detached garages typically sit at the back of the lot with direct alley or driveway access, you're not fighting a cramped, landlocked footprint. The backyard has room to work with.
SB 9 Stacks the Opportunity Further
Here's where Lakewood gets interesting for the investor who wants to go bigger.
SB 9 — California's Urban Lot Split and Duplex law — allows eligible single-family properties in R-1 and R-A zoning to be split into two separate parcels, with new development rights on each. In Lakewood, where many lots are wide enough to accommodate a split, this creates a compelling combination: demo the detached garage, split the lot under SB 9, and build a new unit on the rear parcel with its own legal access from the alley.
That's not a hack or a gray area — that's exactly the scenario the legislature envisioned when it passed SB 9. And because Lakewood's typical lot configuration gives you alley access at the back, you often don't need to carve an easement through the front lot to serve the new one. The infrastructure is already there.
The 3-year owner-occupancy requirement applies to SB 9 lot splits — you need to live on one of the resulting parcels for three years from the recorded date. For owner-users who are buying anyway, this is a non-issue. For investors, it's worth factoring into your hold timeline before structuring a deal around it.
Developers Are Already Moving
One of the clearest signals that a market has real ADU and infill potential is when developers start showing up and getting projects approved. That's already happening in Lakewood.
Builders who know how to work California's ADU and SB 9 frameworks are acquiring lots in Lakewood, getting plans through permitting, and delivering new units at a pace that's noticeably higher than in comparable LA County suburbs. When you see developers competing for the same lots as owner-occupants, it's a reliable sign that the numbers are working — and that city-level approval processes aren't presenting unusual friction.
That's not true everywhere. In some cities, ADU applications get buried in discretionary review or stalled by local ordinances that haven't caught up with state law. California's HCD has the authority to flag non-compliant ordinances and push cities to align with state law — a process that's been driving significant loosening of local restrictions across LA County over the past few years. Lakewood has been part of that wave.
Appreciation Has Rewarded Those Who Got In Early
Lakewood has experienced meaningful appreciation over the past several years. Properties that traded in the low-to-mid $600s a few years ago are now pushing $850K–$900K. That's not a fluke — it reflects genuine demand from buyers who are being priced out of El Segundo, Torrance, and Signal Hill and are landing in Lakewood as a South Bay adjacent alternative.
For ADU investors, appreciation matters for two reasons. The obvious one is equity. The less obvious one is that rising values in a neighborhood attract better tenants, support higher ADU rents, and make lenders more comfortable financing construction. When a neighborhood is on the move, the ADU pitch to a potential buyer or tenant is easier to make.
This is also why acting before the market fully prices in ADU potential is the move. Once the broader buyer pool figures out what Lakewood lots can do, that lower entry price point compresses.
What to Do Before You Write an Offer
If you're seriously considering a Lakewood property for its ADU potential, the due diligence steps matter. You need to know the lot dimensions, whether the existing garage qualifies for conversion or demo-rebuild, where the sewer lateral runs, and what setbacks apply to the specific parcel.
How to verify ADU potential during escrow is worth walking through before you remove contingencies. And if you're buying a property that already has an ADU or converted unit on it, knowing which documents to collect during escrow protects you from inheriting someone else's permitting problems.
The opportunity in Lakewood is real. But like any ADU market, it rewards buyers who do the work upfront.
Ready to Find Your Lakewood ADU Property?
Lakewood lots move fast once the right buyer understands what they're looking at. If you want help identifying properties with real ADU upside — detached garages, rear alley access, SB 9-eligible lot dimensions — I can run a targeted search for you before anything hits the open market.
I'm Dylan Serna, an ADU specialist agent focused on LA County and Orange County. I work exclusively with buyers and sellers who are serious about ADU value.
Let's find your Lakewood property.
Call or text Dylan Serna - (714) 860 - 2868 to schedule consultation call
Or Book from our link below":
📞 Schedule a free ADU buyer consultation
Looking for ADU-ready properties in Lakewood or other LA County markets? Reach out — this is exactly what we specialize in.
