Relaxing zoning restrictions to permit accessory dwelling units (ADUs) have proved to be one of the most effective ways to increase housing supply. This is particularly true in California, where state ADU legislation removed almost all zoning and process barriers to ADU housing across all 450 cities and counties. ADUs are now a significant source of new supply. This brief explores the legislative actions that have proved necessary to break down the zoning and process barriers and the resulting increase in housing supply. The brief also argues that financing is a barrier, and changes should be made to federal financing programs to better accommodate ADU financing. The financing improvements include counting rental income, improvements in the appraisal process, and making renovation financing less cumbersome. Fixing the financing issues would allow for still more ADU production, further alleviating the chronic undersupply of housing.