• Private home insurers are dropping a growing number of customers in most states, a Senate report found.
• That leaves homeowners at risk, turning to more expensive last-resort options or going uninsured.
• While Florida has managed to reverse the trend somewhat, the risk to homeowners is set to intensify.

As Americans flock to places in the US vulnerable to natural disasters, private home insurance companies are running the other way.

The problem has left a rising number of homeowners with just one option to cover property damage: insurers of last resort.

The scale of homeowners losing their plans became clearer on Wednesday after a Senate Budget Committee investigation found that private insurers' nonrenewals spiked threefold in more than 200 counties between 2018 and 2023.

"What our new data reveal is that the failure to deal with climate change is also affecting whether families can even get homeowners insurance, which threatens their ability to get a mortgage, which spells trouble for property values in climate-exposed communities across the country," Senate Budget Chairman Sheldon Whitehouse said in releasing the report.

A recent study by Harvard University's Joint Center for Housing Studies found that between 2018 and 2023, the number of properties enrolled in California and Florida's insurers of last resort more than doubled. A similar trend is playing out in Louisiana. While Florida has reduced participation this year, it still has the highest enrollment in the country.

The problem isn't isolated to the most predictable states. The Senate Budget Committee found that the rate of homeowners losing their private insurance also rose in Hawaii, North Carolina, and Massachusetts.

Policymakers and insurers are trying to stabilize the private market, by enacting new laws and overhauling regulations. However, with scientists predicting that climate-fueled disasters will become more frequent and severe for the foreseeable future, the risk to America's homeowners is mounting.

Growing insurance risk has some states looking for solutions

In nearly three dozen states, insurers of last resort, known as Fair Access to Insurance Requirements, or FAIR, are available to homeowners and businesses who struggle to find insurance on the private market.

The numbers are rising because private insurers are pulling back coverage and hiking premiums in areas at risk of wildfires, hurricanes, flooding, and other disasters often made worse by climate change.

While state-mandated FAIR plans are designed to be a backstop, insurance regulators and private insurance companies are alarmed by how many homeowners and businesses are enrolling, especially in California and Florida. The plans are often more expensive and provide less coverage. Plus, saddling one insurer with the riskiest policies increases the chances of one major disaster sinking the system and leaving taxpayers and insurance companies with the bill.

Florida and California are trying to reverse the trend, and Florida has seen some progress. The state's insurer of last resort, Citizens Property Insurance Corporation, said on December 4 that its policy count dropped below 1 million for the first time in two years.

Mark Friedlander, a spokesperson for the Insurance Information Institute, said the drop reflects a series of changes in recent years to stabilize the state's private insurance market after more than a dozen companies left the state or stopped writing new policies.

The Florida legislature passed laws to curb rampant litigation and claim fraud that drove up legal costs for private insurers. Friedlander said insurance lawsuits in the first three quarters of 2024 are down 56%, compared with the first three quarters of 2021 — the year before the new laws were enacted. Citizens also started a "depopulation" program that shifts customers to the private market. State regulators in October said they had approved at least nine new property companies to enter the market, and premiums weren't rising nearly as much as last year.

In California, many of the deadliest and most destructive wildfires have occurred within the last five years. As a result, some private insurers are hiking premiums and limiting coverage in risky areas, pushing more homeowners to the insurer of last resort. The Harvard study found that policies in the state's FAIR plan doubled between 2018 and 2023 to more than 300,000. As of September, the California Insurance Commission said policies totaled nearly 452,000.

The commission is working to overhaul regulations to slow the trend, including requiring private insurers to sell in risky areas. In exchange, it should be easier for companies to raise premiums that factor in reinsurance costs and the risks of future disasters. That should help stabilize rates, said Michael Sollen, a spokesman for the commission.

Sollen added that in the past, private insurers could seek approval for higher premiums but weren't required to offer coverage in wildfire-prone areas.

"In a year from now, what's happening with the FAIR plan will be a key measure for us," he said. "We expect to see those numbers start to stabilize and go down."

A mounting home insurance crisis

Still, a reduction in state-backed plans isn't necessarily a sign of progress, Steve Koller, a postdoctoral fellow in climate and housing and author of the Harvard report, told Business Insider.

A growing number of homeowners in places like Florida, Louisiana, and California are purchasing private insurance from nontraditional providers barely regulated by state governments. These so-called "non-admitted" insurers don't contribute to a state fund that guarantees homeowners will have their claims paid even if the insurance provider fails, leaving their customers without access to this backup coverage.

"Someone could be moving to a private insurer from Citizens, and that insurer might have higher insolvency risk," Koller said.

He added that more homeowners are opting out of insurance altogether. The number of US homeowners going without insurance has soared from 5% in 2019 to 12% in 2022, the Insurance Information Institute reported.

Plus, Americans are increasingly moving into parts of the country most vulnerable to extreme weather. Tens of thousands more people moved into the most flood—and fire-prone areas of the US last year rather than out of them, the real estate company Redfin reported earlier this year.

As insurers of last resort try to shift more risk to the private market, home insurance premiums are expected to keep rising. That's especially true in the areas hardest hit by climate-fueled disasters.

If private insurers exit hard-hit regions en masse in the future, Koller said states might need to become the predominant insurance provider in the same way the National Flood Insurance Program took over after the private market for flood insurance collapsed in the 1960s. Most flood insurance plans are still issued by the federal government.

"My guess is states are going to work very, very hard to avoid that and ensure the existence of a robust private market, but that's a parallel that I can't personally unthink about," he said.

Have you struggled to get home insurance, moved to an insurer of last resort, or gone uninsured? Contact these reporters at [email protected] or [email protected].

• Vermont, home to Sen. Bernie Sanders, has long been known for its progressive politics.
• But in the November general election, Republicans made key inroads in state legislative races.
• Many voters, who generally back Democrats on the federal level, sided with the GOP on local issues.

In recent decades, Vermont has become known for its progressive politics, with figures like independent Sen. Bernie Sanders dominating the New England state's political landscape.

On the federal level, the Democratic edge is clear. Vice President Kamala Harris defeated President-elect Donald Trump by over 31 points in Vermont, one of her top showings in the country.

The popular Republican governor, Phil Scott, even voted for Harris, declaring he "put country over party."

But further down-ballot, Republicans made some key gains in Vermont, breaking Democratic supermajorities as voters concerned about affordability boosted the GOP in a series of pivotal races.

Before the November general election, Democrats held 107 out of 150 seats in the Vermont House of Representatives, and the GOP held 37 seats. But when the state House reconvenes in January, Democrats and Progressives will have 91 seats, compared to 56 for the GOP; independents will hold three seats. And in the Vermont Senate, the previous 21 to 7 Democratic advantage over the GOP will shrink to a 16 to 13 Democratic majority (in addition to one Progressive member).

While Democrats will continue to hold majorities in both chambers, they'll lack the numbers to override any vetoes from Scott, who in November was reelected in a nearly 52-point landslide on a platform of stabilizing the school budget process and staving off significant property tax increases. The governor has also sought to tackle the housing shortage in Vermont, where affordability has been a major issue for lawmakers in recent years.

A June 2024 assessment taken for the Vermont Department of Housing and Community Development found that the state will need to boost the pace of homebuilding to produce the 24,000 to 36,000 new year-round homes from 2025 through 2029 needed to address demand and replace homes impacted by flooding.

"The goal is to get them to come to the table … and to get enough support to work toward more affordability," Scott's policy director, Jason Maulucci, told The New York Times, referring to Democratic state lawmakers.

Trump made critical electoral gains across the country as many voters dissatisfied with the economy opted for him instead of Harris. During President Joe Biden's term in office, inflation drove blocs of traditionally Democratic-leaning constituencies, like Latino voters and young voters, into the GOP's fold.

After Biden stepped aside as the presumptive Democratic presidential nominee in July, Harris took on the party's messaging on the economy. But despite some polls showing her having made inroads against Trump on the issue, she ultimately fell short in critical swing states.

Vermont's form of Republicanism has traditionally been more moderate than the socially conservative brand that defines the national GOP. However, the state is still dominated by rural areas, where the party was ripe for gains. Democrats, who for years have been the driving force in the state capital of Montpelier, faced the ire of many voters who wanted to see the legislature curb tax hikes in the state.

"Voters have been telling us for years that they're sick of rising costs, rising rents, rising property taxes and grocery bills, and they feel like they can't get ahead," consultant Lachlan Francis told the Times. "They have felt that way for a long time, as the Legislature followed an agenda that was perceived as inflationary, and there was a price to pay for that."

• US News & World Report created a list of the best places to live in the US in 2024.
• Factors such as housing affordability, job opportunities, and quality of life determined the list.
• Naples, Florida, tops 2024's list, followed by Boise, Idaho, and Colorado Springs, Colorado.

Deciding where to live isn't always easy.

Some people move multiple times in a decade, searching for new experiences or better opportunities. Others end up regretting relocating to their new homes.

While everyone's circumstances are unique, data can help narrow down the choices.

Every year, US News & World Report ranks 150 big cities based on factors including quality of life, schools, crime rates, employment opportunities, and housing affordability to find the best places to live in the United States.

For 2024's list, the South and the Midwest have the most cities ranked in the top 15.

Booming Boise, Idaho; outdoorsy Colorado Springs, Colorado; and the bustling banking hub of Charlotte, North Carolina, all consistently make the list of the best places to live. Newcomers include Austin, a growing tech hub, and two scenic South Carolina locales: Greenville and Charleston.

In addition to weighing job opportunities and housing costs, US News & World Report emphasizes each area's overall standard of living.

Here are the 15 best places to live in the US, according to US News & World Report. Residents find plenty to like about these cities, including relatively affordable homes, plenty of jobs, and lots of ways to spend their free time.

15. Lexington, Kentucky

Population of the metro area: 320,154

Median home price: $331,000

Median monthly rent: $1,600

Median household income: $66,392

Climate Vulnerability Index: 58th percentile (average vulnerability). This index shows areas of the US most likely to face challenges from climate change.

Known for: Home to over 450 horse farms, Lexington is known as the horse capital of the world. While it doesn't have the Kentucky Derby, Keeneland Race Track holds its own horse races twice a year.

14. Madison, Wisconsin

Population of the metro area: 280,305

Median home price: $415,000

Median monthly rent: $1,700

Median household income: $70,484

Climate Vulnerability Index: 6th percentile (lowest vulnerability)

Known for: Wisconsin's capital is also the state's second-largest city. Madison is a college town, offering plenty of chances to see concerts and sporting events.

13. Charleston, South Carolina

Population of the metro area: 155,369

Median home price: $617,500

Median monthly rent: $2,800

Median household income: $89,083

Climate Vulnerability Index: 55th percentile (average vulnerability)

Known for: With its cobblestone streets and 18th- and 19th-century buildings, Charleston is a dream for historic-architecture buffs. Plus, miles of beachy coastline are just a short trip from downtown.

12. Green Bay, Wisconsin

Population of the metro area: 105,744

Median home price: $318,000

Median monthly rent: $999

Median household income: $66,950

Climate Vulnerability Index: 15th percentile (lowest vulnerability)

Known for: Wisconsin's oldest city is home to the Green Bay Packers, a storied NFL team. Nature lovers can make the most of Green Bay's 25-mile Fox River State Trail, even in the winter.

11. Sarasota, Florida

Population of the metro area: 57,602

Median home price: $488,500

Median monthly rent: $2,800

Median household income: $68,870

Climate Vulnerability Index: 24th percentile (lower vulnerability)

Known for: Sarasota earned the nickname the Circus City because Ringling Bros. and Barnum & Bailey Circus moved its winter quarters to the beachy town in 1927. These days, the weather, leisurely pace of life, and lack of income tax all attract people to Florida. Sarasota, in particular, has become a magnet for workers, according to a January LinkedIn report.

10. Boulder, Colorado

Population of metro area: 105,898

Median home price: $945,000

Median monthly rent: $2,995

Median household income: $75,923

Climate Vulnerability Index: 12th percentile (lowest vulnerability)

Known for: Not far from the Rocky Mountains, Boulder is known for outdoorsy activities, including rock climbing, hiking, skiing, and cycling. The city's median age is 28.6, giving it a youthful, lively energy.

9. Austin

Population of metro area: 979,882

Median home price: $484,900

Median monthly rent: $2,000

Median household income: $91,501

Climate Vulnerability Index: 20th percentile (lower vulnerability)

Known for: An artsy, contemporary city, Austin is known for its vibrant nightlife, live music, eclectic cuisine, and college scene. It also has a long history of attracting tech giants, and even more companies have opened offices there since the pandemic. West Coasters in the industry have moved to the city, lured by the booming job market and comparatively low cost of living.

8. Virginia Beach, Virginia

Population of metro area: 453,649

Median home price: $384,500

Median monthly rent: $2,195

Median household income: $91,141

Climate Vulnerability Index: 18th percentile (lowest vulnerability)

Known for: Boasting a beloved boardwalk, Virginia Beach has miles of beaches, delectable seafood, and a mild climate. Murals, museums, and shops in the ViBe Creative District give the seaside destination some arty flair, too.

7. Huntsville, Alabama

Population of metro area: 225,564

Median home price: $315,000

Median monthly rent: $1,465

Median household income: $73,319

Climate Vulnerability Index: 54th percentile (average vulnerability)

Known for: Since the start of the US space program in the 1950s Huntsville has been a hub for the aerospace and defense industries. Today it's bursting with startups, alongside long-standing workplaces like NASA and Boeing. Jeff Bezos' Blue Origin also has a facility for building rocket engines in Huntsville.

6. Raleigh, North Carolina

Population of metro area: 482,295

Median home price: $450,000

Median monthly rent: $1,826

Median household income: $86,309

Climate Vulnerability Index: 13th percentile (lowest vulnerability)

Known for: This capital city has a busy downtown, free museums, and miles of hiking trails. Part of North Carolina's Research Triangle, Raleigh has a long history of fostering technology and science companies, creating a strong local economy.

5. Charlotte, North Carolina

Population of the metro area: 911,311

Median home price: $424,900

Median monthly rent: $1,950

Median household income: $80,581

Climate Vulnerability Index: 35th percentile (lower vulnerability)

Known for: Second only to New York, Charlotte is a bustling banking hub. Locals can root for the city's professional basketball, football, and soccer teams or soak up the art and food scenes.

4. Greenville, South Carolina

Population of the metro area: 72,824

Median home price: $366,500

Median monthly rent: $1,725

Median household income: $73,536

Climate Vulnerability Index: 55th percentile (average vulnerability)

Known for: In the foothills of the Blue Ridge Mountains, Greenville attracts new residents with its moderate climate, burgeoning food reputation, and natural beauty. Greenville is also home to several major corporations, including Michelin, GE, and Lockheed Martin.

3. Colorado Springs, Colorado

Population of the metro area: 488,664

Median home price: $440,000

Median monthly rent: $1,873

Median household income: $83,215

Climate Vulnerability Index: 34th percentile (average vulnerability)

Known for: The US Olympic and Paralympic Training Center is located in Colorado Springs, making the city especially attractive to athletes. There are hundreds of miles of trails for hiking and mountain biking, and white water rafting is a popular summer activity. From the Garden of the Gods to the iconic Pikes Peak, gorgeous natural sights adorn the area.

2. Boise, Idaho

Population of the metro area: 235,421

Median home price: $472,500

Median monthly rent: $1,774

Median household income: $79,977

Climate Vulnerability Index: 9th percentile (lowest vulnerability)

Known for: Thousands of new residents flocked to Idaho's capital in the past decade, making it the US's fastest-growing city in 2018. Boise blends sought-after amenities such as microbreweries and cider houses with nearby scenic state parks full of rivers, canyons, and mountains.

1. Naples, Florida

Population of the metro area: 19,704

Median home price: $629,500

Median monthly rent: $6,100

Median household income: $135,657

Climate Vulnerability Index: 32nd percentile (lower vulnerability)

Known for: Located on Florida's Gulf Coast, Naples is like a postcard come to life, with white-sand beaches, luxurious residences, and over 1,350 holes of golf. The city has long attracted wealthy residents who can afford the high housing costs. Right now a $295 million compound is up for grabs, the most expensive home for sale in the US.

Sources: Population and income data are from the US Census, median home price from Realtor.com, median rent from Zillow, and climate information from the Climate Vulnerability Index.

This story was originally published on May 15, 2024, and most recently updated on December 4.

• Former Illinois residents Jason and Jennifer Remillard dreamed of living a simple, debt-free life.
• The couple purchased a $50,000, 58-acre property in Maine in 2019 near the Canadian border.
• They turned two $12,000 Amish sheds into their home, connecting them with a custom-built hallway.

This as-told-to essay is based on a conversation with Jason Remillard, 49, and his wife Jennifer Remillard, 55, who left the Chicago suburbs to retire on a Maine homestead.

They built their dream home out of two $12,000 Amish sheds, which are built one at a time using traditional techniques instead of mass-produced. The following conversation has been edited for length and clarity.

My wife Jen and I lived in a small town called Wauconda just outside of Chicago. Jen was a supervisor in the photo lab at Costco, and I was the director of quality and operations for a touchscreen manufacturer.

We were the typical American family. We'd sit down on the couch and we'd watch TV. Then we'd go to bed, and wake up. Rinse and repeat every day.

In about 2010, we decided that once all six kids were graduated and out of the house, we wanted to live an off-grid lifestyle and homestead. We spent 10 years preparing for the transition.

In January 2019, we found a piece of property in Maine on LandWatch.com. We flew up a week after we saw it, and hiked a mile and a half in knee-deep snow with our real-estate agent to look at it. We fell in love with it.

It's in the Houlton area of Maine, about three and half hours north of Portland. We're at the end of an unmaintained road on the Canadian border.

We paid $50,000 for 58 acres.

I loved the privacy of it. We only have a few neighbors within a mile of us.

We dreamed of a debt-free lifestyle off the grid

In June 2021, we sold our Wauconda home. We packed up our trailer and U-Haul, dropped our son off at the Marine Corps, and drove out here.

When we left Illinois, we wanted everything paid off. The property was $50,000, the vehicles were $40,000, the two Amish cabins were $24,000, and the solar panels were $12,000. Over four years, we put all that money aside so that when we stepped on the property in 2021 we didn't have to worry about anything.

It allows me to work two and half hours a day on the property and maintain this lifestyle without worrying about heavy debt. It's about being able to work on your home, work on improving your life, without spending two-thirds of your day at a job that you don't like.

It was really just a mad dash to figure out what the game plan was. We had no experience with this lifestyle. We made hundreds of to-do lists.

The first thing we had to do was mow the lawn. Then we worked on rebuilding the fence and had a gravel pad — a foundation for our homes — installed. We had to clean out the old shed that was on the property and fix up a temporary storage building.

It was just a lot of busy work. We installed solar panels so that we weren't running on a generator 24 hours a day. We had to cut enough firewood for the winter.

Being at the end of an unmaintained road, the Border Patrol informed us that our property was used as a "lovers lane," a place for young people to go and just mess around. So, we put up a fence along the road section of our property, just to let people know that we are actually living here now.

The Amish sheds give us flexibility for a permanent home

In 2020, when we had the property but were still living full-time in Illinois, we met one of our Maine neighbors on a trip. They were kind enough to invite us over and they showed us the Amish shed they had for their home. We weren't really sure what route we wanted for our forever home, but we saw theirs and just thought, "Hey, we could do this, too."

We reached out to Sturdi-Built Storage Buildings in Smyrna, Maine. We designed our own cabins, everything from where the windows are to where the doors are.

We're so glad we didn't go the log cabin route because these buildings are so incredibly versatile. Since we've had them, we've built a porch on one side. We're going to add a sun room to another side next year.

My first thought was to put them in an L shape. But then my concern was that the snow here in the winter. If I had my two cabins in an L shape, inside the L there would just be a massive pile of snow when it all slid off the roof.

If I were a professional carpenter, I could connect the two buildings at the roofline and make them look seamless like one building. But I'm not that guy. So, I built a small 5x5 hallway between the two buildings. It was the extent of my abilities, but it works fantastic.

When the cabins were delivered, they were just shells. The floor had insulation, but wasn't finished, and the walls were just 2x4s. There was no electrical, plumbing, or siding. We went through our first winter with no siding on our walls. We had to do everything. We spent around $10,000 making the two sheds into our home.

All of the hard work that Jen and I have done — I wouldn't trade that for anything.

If someone wants a big, elaborate place, the Amish shed probably isn't for you. This is for someone who wants a small footprint for their home. But they're adaptable to any environment, down south in Texas, out in Appalachia, up in Oregon, the Midwest, and, of course, here in Maine.

We've documented this journey on YouTube. It's to show people out there who aren't in their 20s that no matter how old you get, you can still follow your dreams.

• US home prices and rents have soared in part because of a shortage of housing.
• There are four key obstacles to building more housing, according to one industry leader.
• These are the cost of land, a shortage of construction workers, regulations, and NIMBYism.

The US is suffering from a deep shortage of homes, and it's driving sky-high home prices and rents.

The laws of supply and demand explain it: the supply shortage — estimates of which range from 2.8 million homes to more than 7 million homes — coupled with an uptick in demand in recent years has sent prices soaring.

The leader of the top trade association and lobby for the home construction industry thinks there are a few key obstacles to fixing that shortage. Jim Tobin, CEO of the National Association of Home Builders, blamed the high cost of land, a shortage of skilled construction workers, burdensome government regulations, and the anti-development "Not in My Backyard" sentiment for the home shortage.

Cost of land

The cost of land — a significant portion of the cost of a home —has risen significantly in many places in recent years as its availability has plummeted, exacerbated by high demand for housing and restrictive land-use laws that prohibit dense development.

At least 75% of residential neighborhoods in many major US cities like Los Angeles, Seattle, and Chicago are zoned exclusively for detached single-family homes. This means that as demand for housing increases, these communities can't accommodate many additional homes. As demand overwhelms the supply of land, prices rise.

"We just hear more and more that it's harder to find affordable pieces of land to develop for housing," Tobin said.

A worker shortage

A national shortage of construction workers — estimated at around 500,000 workers this year — has also driven up the cost of building new housing and renovating existing homes, Tobin said, noting that skilled workers in residential construction are in particularly short supply.

Fewer construction workers means less — and slower — residential construction and higher wages for workers, which in turn leads to higher home prices. The worker shortage has mounted as policymakers have emphasized college over the trades, and a wave of experienced workers retired during the pandemic, industry experts said.

Lots of regulations

Tobin also pointed out that builders face a significant regulatory burden. Rising demand for housing in recent years has run headlong into a web of local, state, and federal regulations — from restrictive single-family zoning to energy code requirements — that slow down or kill residential construction in communities across the country, he said. When it comes to housing, state and local governments control the majority of regulations that most inflate housing costs by limiting or slowing down construction, but federal regulations also play a role.

"Those delays all add up to more costs and less availability," Tobin said. "We need all options on the table when it comes to increasing housing supply, which means allowing more density in suburbs or cities."

'NIMBY' opposition

Many of these restrictive regulations are bolstered by local opposition to new housing — epitomized by "NIMBY," or "Not in my backyard," sentiment, Tobin said. Many local homeowners oppose new construction for the simple reason that additional housing in their community would depress their home values, he argued.

"One of the challenges we have in localities across the country are people that already have theirs, and they don't want anybody to have theirs," Tobin said. "We have local government officials that won't back more housing development because they're afraid of the backlash from local constituents."

The future of housing

Tobin said the strength of the overall economy and interest rates will also play a major role in determining housing costs over the next few years. He expects mortgage rates to settle into a "new normal" of about 5 to 5.5% by 2026, lower than the current 30-year fixed rate of 6.79% but above the pre-pandemic average.

Looking to next year, Tobin said he expects President-elect Donald Trump to have a mixed impact on housing costs. He's optimistic Trump will roll back some federal regulations and open up some federal land for new housing, but he's concerned about mass deportations potentially shrinking the already scarce supply of workers, and new tariffs inflating the cost of building materials.

Tobin said he plans on working with Trump's transition team, the new administration, and Congress to advocate for tariff policies that don't send building costs surging. "I would certainly welcome an increase in domestic industry when it comes to building materials," Tobin said, "but tariffs only work if that is the outcome."

• Christine Wilder-Abrams began to struggle with the stairs of her two-story house in California.
• She didn't want to leave her home of 35 years, so she built an ADU, or "granny pod," in the yard.
• Her 34-year-old daughter now lives in the main home, which Wilder-Abrams calls a win for them both.

In 2021, Christine Wilder-Abrams started to struggle with the stairs in her two-story home in Oakland, California.

She wasn't ready to give up the home or neighborhood she had lived in for nearly 35 years, so she found a solution: build a one-story accessory dwelling unit, or ADU, in her backyard that she could live in, then ask her daughter to move into the main house.

"I was ready to downsize and have a smaller place to live and take care of," Wilder-Abrams, 72, told Business Insider. "The home is in an urban area, so there are a lot of possibilities for my daughter, too."

ADUs have become a popular alternative to traditional apartments or houses, in part due to their relative affordability and how little land they require.

These smaller units, typically 150 to 1,200 square feet, cost between $100,000 and $300,000 to build on average. However, additional expenses, such as inspections, utility installations, and permitting fees, can add to the cost.

An analysis of Google search data shows growing interest in "granny pods," or small outbuildings where older relatives or family members who need extra support can age in place while maintaining independence and personal space.

Wilder-Abrams, 72, now lives in the 560-square-foot, one-bedroom, one-bathroom tiny home that she financed and built for about $350,000. Meanwhile, her 34-year-old daughter lives in the 2,000-square-foot, three-bedroom, two-bathroom main house with her three-and-a-half-year-old daughter.

The ADU was a win for mom, daughter, and granddaughter

For Wilder-Abrams, building an ADU in her backyard and having her daughter move into the main house was much more affordable than purchasing a new home in Oakland.

Wilder-Abrams said that her family home, purchased in 1987 for about $230,000, is now valued at over $1 million. As of October, the median home sale price in Oakland was $751,455, according to Zillow.

"It's hard for me to believe houses cost that much today," she said. "How can anybody afford it?"

Beyond affordability, ADUs also offer families an added sense of security. They're a practical solution for adult children or aging parents who want to maintain their independence while still having access to support.

Wilder-Abrams said that the new living arrangements have benefited her and her daughter, who was widowed in October 2023, equally.

"I get to live close to my daughter and granddaughter," she said. "It's nice that I'm here for them."

Wilder-Abrams especially loves seeing her granddaughter regularly. "It's great watching her grow up," she added.

The construction process of the ADU

Wilder-Abrams' tiny home was built by Inspired ADUs, an ADU builder operating in Oakland, Orange County, and the greater Bay Area, which she found online.

Inspired ADUs offers over 70 different layouts, ranging from 300-square-foot studios to two-story units exceeding 1,200 square feet. Prices start at $13,800 for pre-designed or custom ADU plans, $215,000 for panelized kits, and up to $314,000 for a full prefabricated unit. The company also manages the permitting process for its clients.

"The permitting process was really easy," Wilder-Abrams said. "The architect said it'll take about three months, and it took three months."

Construction on Wilder-Abrams' ADU began in 2021. By May 2022, her daughter had moved into the main house, and she had settled into the ADU.

To finance the construction of the ADU, Wilder-Abrams took out a second mortgage on her home, as the original mortgage had been paid off years earlier. She now has a monthly mortgage payment of $1,500, which her daughter pays as rent.

Downsizing can be difficult

Wilder-Abrams' ADU has an open floor plan with high ceilings, large windows, and brand-new European appliances, including a refrigerator, dishwasher, stove, oven, and stackable washer and dryer. Her new home also has its own patio and garden.

"My ADU feels very spacious," she said. "Everybody's surprised by how big it is."

Despite the generous size of the ADU, Wilder-Abrams had to part with many belongings, including most of her longtime furniture — such as her couch and dining room table — as well as items that had belonged to her husband and both of their parents.

"Downsizing is hard. You really have to want to do it," she said.

Wilder-Abrams now has an apartment-sized L-shaped sofa, and instead of a dining table, there's a built-in bench in the ADU where she eats.

"I think having less stuff is freeing. There are just fewer things for me to take care of or worry about all the time," she said.

Wilder-Abrams has more security

Swapping homes with her daughter wasn't something Wilder-Abrams had envisioned years ago, but it's turned out to be a surprisingly successful arrangement for both of them.

"I wasn't sure if she would want to return to her childhood home, but she's happy about it," Wilder-Abrams said.

Another benefit is the support she has received as she ages. Last year, Wilder-Abrams had knee surgery, and she said her recovery would have been much more challenging without her daughter nearby.

"The first few days, she stayed with me to change the ice packs regularly," she said. "It was so convenient for both of us."