What You Should Know Before Investing In an Accessory Dwelling Unit

Are you considering investing in the accessory dwelling unit, and don’t know how to go about it?

Building an accessory dwelling unit is the best way to take advantage of wasted space, and allowing tenants to enjoy the same area without invading your privacy. What’s more, you’ll earn extra income and cover your bills. However, just like anything, building an accessory dwelling unit comes with its host of challenges. Perhaps the biggest one is the fact that accessory dwelling units often require an initial investment. So, if you haven’t done your homework well, you might end up flushing your hard-earned money down the drain.

First things first; what is an accessory dwelling unit?  An accessory dwelling unit is a secondary residential unit on a single property. People often use different names like mother-in-law suites, granny’s flat, or backyard cottages to refer to them. Homeowners can use them to house guests, friends, or even family members.

Here’s what you should do before investing in an accessory dwelling unit.

  1. Do Some Research

Some people think building an accessory dwelling unit is a straightforward process, but this is not the case. At worst, it can be a complex and costly process. Additionally, you’ll often find that zone laws vary from state to state, sometimes even city to city. That’s why it’s essential to do some research before building one. Questions you might want to ask yourself include:

  • What are your city’s rules pertaining to ADUs?
  • Is an ADU a good fit for your personality?
  • Can you afford to build it?
  • What are the zoning restrictions in your city?
  1. Invest wisely 

Once you’ve done all the needed research, assess the costs related to building an accessory dwelling unit. If you’ll be building your accessory dwelling unit from scratch expect spending more money. Remember, if you want to recoup your investment urgently, an ADU might not be the best option for you. Experts recommend that you budget at least $100,000 for this endeavor. A lot of money you don’t want to waste.

  1. Know all Accessory Dwelling Unitoptions

Most homeowners build an accessory dwelling unit to meet a variety of different needs, from housing guests or even to generate an extra income. That said, if you know different options for building an ADUs, budgeting becomes fairly easy. Here are some of them:

  • New Construction ADUs – they cost typically the same as prefabricated units. They are turnkey, which means they are quick to install.
  • Converted Buildings ADUs – these are freestanding buildings that were subsequently converted. A good example could be a shed that was renovated to become a dwelling unit.
  • Attached ADUs – well, here you can consider turning your spacious garage into an ADU. But before you start building, you need to think about your cars. Where are you going to park them? Also, would you need to allocate parking space for your cars? Over and above that, check your local ordinances just to make sure that it’s permissible to create additional parking spaces in your yard.
  • Utilize Your Space – If you have enough space in your yard to build an ADU, that’s a good start. The only thing you need to worry about is where you want to have it built. Most homeowners prefer an ADU to be far off from the property line.
  • Interior ADUs – this is another cheaper option that you should consider. For instance, you can convert your basement into a nice ADU. The fact that you don’t need to worry about such things as wiring, plumbing, and insulation, makes this one of the most affordable options.

Building an Accessory Dwelling Unit is most successful when working with a seasoned professional and making sure your unit complies with your local zoning codes and rules.

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