Backyard ADU in Berkeley is listed as a $995,000 private residence in a creative effort to provide more affordable housing in the Bay Area
A 100-year-old Bay Area property that was once home to a primary residence and a studio apartment has now been transformed into a three-home complex where multiple homeowners share some of the property.
1516 Blake St. in Berkeley, CA, began as a Mediterranean-style home built in 1925, but in recent years, as demand for affordable housing in the area has increased, it has evolved into a unique tenant-only community with three separate addresses, all located on the same lot.
Initially, the main house was split in two, with one section converted into a 30 square meter, one-bedroom studio apartment, which is still attached to the original house but has its own address.
It sold in June of this year for $375,000, setting the tone for the third home on the property to make its mark on the housing market.
Enter Unit A, an accessory dwelling unit (ADU) located in the backyard of the original home. It was completed in October and has now hit the market as a private single-family home with an asking price of $995,000.
At first glance, Unit A may seem like a typical modern home for sale, with 1,154 square feet of living space, including two bedrooms and two bathrooms.
The open-plan living, dining and kitchen areas connect seamlessly to a private terrace and garden, offering a level of privacy that may surprise buyers familiar with shared ownership models. Sustainable design features include a split heat pump and AC system, on-site solar power, and natural finishes throughout.
The idea for the ADU came about when the owner of the main home, an urban planner with an eye for progressive housing solutions, saw an opportunity to maximize land use. And thereby creating a more affordable real estate option.
Meet New Avenue Homes, a Berkeley-based development company that has been pioneering small-scale housing solutions in the Bay Area for more than 15 years. The group helped orchestrate the property’s conversion to a tenants-in-common (TIC) arrangement, dividing ownership of 1516 Blake St. among multiple parties, and designed the new ADU that now occupies the rear of the lot.
The result is a rare East Bay example of the TIC + ADU hybrid model, which until now has been much more commonly used in San Francisco but is now starting to gain traction in the Bay Area.
It’s an arrangement that may not be attractive to everyone, broker Jodi Nishimura admits, but it’s a setup that could well become the norm as more people look to provide affordable housing in an area considered difficult for all but the wealthy to invest in.
“This is an unusual ownership model in the East Bay,” Nishimura noted. “Tenant joint ownership is common in San Francisco, but here it is still quite rare.”
New Avenue acquired the property in October 2022 and initiated plans for both the TIC conversion and the new ADU.
The front house sold in May 2023 for just under $1 million, followed by the adjacent studio in June. By October, the additional two-story unit was completed and sold for $995,000, demonstrating how infill development can unlock more livable space and long-term value from existing properties.
While the property’s price tag may seem high compared to more affordable US markets, it falls below Berkeley’s median price of $1.1 million, giving it a competitive appeal to buyers looking for modern luxury at a more reasonable price.
The concept aligns with California’s push toward infill housing, an ongoing challenge for a state still struggling with affordability.
Earlier this year, Gov Gavin Newsom even rolled back parts of a landmark environmental law to speed up housing construction after California earned a bounty ‘F’ on the Realtor.com® Housing Affordability Report Card by State.
New Avenue aims to address these challenges by reinventing the traditional single-family home as a collection of smaller, connected homes, encouraging multi-generational living, shared ownership and more attainable prices.
Unit A is a tangible example of that vision: modern, efficient and community-oriented yet offering the comfort and autonomy of a detached house.
Located in an attractive part of downtown Berkeley, the property is largely surrounded by single-family homes and close to local dining options, parks and schools.
“The top floor offers views of the Berkeley Hills,” says Nishimura.
“Part of a well-designed three-unit TIC property, it offers a sense of community while maintaining privacy,” the listing said.
“Enjoy easy access to cafes, a corner market, and restaurants less than steps away. Famous and favorite produce markets are nearby, and BART is just over a mile away for an effortless commute.”
In many ways, 1516 Blake St. represents a quiet evolution of the East Bay housing story, one that honors the past while opening doors to more sustainable, inclusive ways of living.
As cities continue to grapple with limited space and high demand, projects like these can offer a glimpse of how the next generation of housing in the Bay Area will take shape.
