"She spent about $100,000 to add a cottage in her backyard in Berkeley in 2011, and has been renting it out for between $1,500 and $2,000 a month. It paid for itself in under five years, she said."

Why do they need to be relaxed if its already profitable to build one?

I wonder what about building such a unit requires too much red tape. Too bad they don't go into it in the article.

Coach house airbnbs and one off rentals could be great or terrible. In either case I think its hard to argue this would get rents to go down.

My personal bet is the proliferation of these cute backyard dwellings would actually make rents go higher because these would go for a premium over 50 year old crummy spots.