Everyone’s talking about small-scale housing, with one of the biggest questions being how to fund it. On May 15, we brought together over 120 participants for a Virtual Roundtable on Finance to tackle that exact challenge. Panelists Jean Lu (US Bank), Josh Morrison (Frolic Community), Carlos Plazola (Buildzig), Sibley Simon (New Way Homes), and Elizabeth Wampler (Bay Area LISC) led a conversation on what’s working, what’s not, and where the opportunities are for making small, community-rooted housing financially feasible.
This wasn’t a lecture. It was a candid, chat-filled session where participants shared challenges, resources, and strategies for getting projects off the ground—whether it’s one backyard unit or a dozen community benefiting homes.
Much of the conversation focused on real financial hurdles. Many attendees reported cost estimates between $300K and $500K for building a single accessory dwelling unit (ADU). For smaller developers or homeowners, that’s often too high—especially when traditional lines of credit or home equity loans aren’t readily accessible. Several participants called for the creation of an “ADU mortgage” product that reflects the real needs of this scale.
Participants also explored alternatives like paper development—getting entitlements approved and then selling the project to reduce risk. Modular and prefab construction came up frequently, but many noted that financing these construction methods is difficult unless a lender has dealt with them before.
Some shared efforts about how to reach net-zero energy standards or use passive house design. Others are working on buildings that integrate food, energy, and water systems. But even with these long-term benefits, the upfront cost is a barrier—and lenders aren’t yet incentivizing this kind of forward thinking development.
Land owned by faith institutions and community organizations came up as a promising but underused opportunity. Several participants shared examples of faith-based partnerships and pointed to helpful resources like Gone for Good, LISC’s Faith & Housing Cohort, and lenders such as the Church Building & Loan Fund and Cornerstone Fund. These collaborations can lower acquisition barriers and help unlock deeply affordable, community-centered housing.
At the same time, many attendees flagged ongoing challenges with local permitting and zoning. Even with supportive state policies on the books, like the Density Bonus Law, projects often stall when cities don’t update their processes or planning departments push back on nontraditional models.
Despite these challenges, participants also pointed to strategies that are helping move projects forward. Some have found traction working with local community banks or CDFIs that better understand small-scale development. Others are reducing risk by partnering with landholders and aligning early with city staff to keep plans code-compliant and straightforward. While state-level tools like Builder’s Remedy and the Density Bonus can create leverage, it’s relationships, timing, and shared learning that often tip the balance. The conversation made it clear: success is possible—and often starts with knowing who to talk to and when.
Many participants saw themselves as both developers and community members—driven not just by building projects, but by a commitment to place, equity, and lasting community benefit.
This event was part of the East Bay Small Development Incubator
The purpose of the East Bay SDI program is to engage small, independent developers, government officials, and others from the residential development ecosystem (suppliers, financiers, etc.) to build the skills and relationships that will enable the industry to thrive and play its role in nurturing communities that are affordable, equitable, and environmentally vital.
We’re hosting our next session on July 24, 2025.
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Let’s keep moving—together—from ideas to action.
Alex Coba
Communication Associate
As a proud California native from Stockton, Alex brings a wealth of experience and a versatile skill set. He has a solid communication background with a Bachelor of Arts in Journalism and Public Relations from California State University, Chico. Alex is adept at strategic communications and media relations, with experience gathering and sharing stories from his local communities that uplift the unique spirit and values of those places. He is excited to join Build It Green, where he can apply his talents to further BIG’s mission to help communities across California thrive