Backyard ADU in Berkeley Is Listed as a $995K Private Home in a Creative Attempt To Provide More Affordable Bay Area Housing

A 100-year-old Bay Area property that was once home to a main residence and a studio apartment has now been transformed into a three-dwelling compound that will see multiple homeowners sharing a piece of the property pie.

1516 Blake St. in Berkeley, CA, began as a Mediterranean-style dwelling that was built in 1925, but in the last few years, as demand for affordable homes in the area has increased, it has evolved into a unique tenants-in-common property with three separate addresses all located on the same parcel of land.

Initially, the primary residence was split in two, with one section turned into a 396-square-foot one-bedroom studio apartment that is still attached to the original home, but features its own address.

It sold for $375,000 in June of this year, setting the scene for the third home on the property to make its mark on the housing market.

Enter Unit A, an accessory dwelling unit (ADU) that is nestled into the backyard of the original residence. It was completed in October and has now hit the market as its own single-family abode with an asking price of $995,000.

At first glance, Unit A might appear to be a typical modern home for sale, offering 1,154 square feet of living space, which includes two bedrooms and two bathrooms.

Its open-concept living, dining, and kitchen areas connect seamlessly to a private deck and yard, offering a level of privacy that might surprise buyers familiar with shared-ownership models. Sustainable design features include a split heat-pump and AC system, owned solar, and natural finishes throughout.

The idea for the ADU was conceived when the owner of the primary residence, an urban planner with an eye for progressive housing solutions, saw an opportunity to maximize the land usage and create a more affordable property option in the process.

Enter New Avenue Homes, a Berkeley-based development firm that has been pioneering small-scale housing solutions across the Bay Area for over 15 years. The group helped to orchestrate the conversion of the property into a tenants-in-common (TIC) arrangement, which split the 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 has thus far been much more commonly used in San Francisco but is now beginning to gain traction across the Bay Area.

It is an arrangement that might not appeal to everyone, listing agent Jodi Nishimura concedes, but it is a setup that could well become the norm as more people seek to provide affordable housing in an area that is deemed difficult for anyone but the wealthy to invest in.

“This is an unusual ownership model in the East Bay,” Nishimura noted. “Tenants-in-common ownership is common in San Francisco, but it’s still fairly rare here.”

New Avenue acquired the property in October 2022, initiating plans for both the TIC conversion and the new ADU.

The front home sold in May 2023 for just under $1 million, followed by the attached studio in June. By October, the additional two-story unit was complete and listed 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 might seem high when compared with more affordable markets across the U.S., it falls under Berkeley's median listing price of $1.1 million, giving it a competitive appeal to buyers seeking modern luxury for a more reasonable sum.

The concept aligns with California’s push for 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 homebuilding after California earned an ‘F’ in the Realtor.com® state-by-state housing affordability report card.

New Avenue aims to address these challenges by reinventing the traditional single-family home as a collection of smaller, connected dwellings, encouraging multigenerational living, shared ownership, and more attainable price points.

Unit A is a tangible example of that vision: modern, efficient, and community-minded while still offering the comfort and autonomy of a standalone home.

Set in a desirable pocket of central Berkeley, the property is surrounded mostly by single-family homes and close to local eateries, parks, and schools.

“The upper floor has views of the Berkeley Hills,” Nishimura says.

"Part of a well-conceived three-unit TIC property, it offers a sense of community while maintaining privacy," the listing notes.

"Enjoy easy access to cafes, a corner market, and restaurants less than a block away. Famed 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’s 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 this may offer a glimpse of how the next generation of Bay Area homes will take shape.