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Why ADU Will Be Good For You. (Accessory Dwelling Units)

Updated: Jul 27, 2023

Homeowners have been increasingly building ADUs (Accessory Dwelling Units) for a variety of reasons, each offering unique advantages. One of the most appealing reasons is the potential to generate additional monthly income. By becoming a landlord and legally renting out the ADU space, homeowners can supplement their earnings significantly. For instance, renting out an ADU for $2,000 to $3,000 per month, depending on the area, could cover the monthly mortgage loan debt of $1,264 (for a $200,000 loan at 6.5% interest) and still leave the homeowner with an extra $800 to $1200 per month. Moreover, if the ADU was constructed using available funds, the rental income could be pure profit, helping to pay off the investment within 7-8 years.

Another compelling reason for building ADUs is to facilitate multigenerational living, which is becoming increasingly relevant as families seek to stay together while accommodating changing circumstances. By creating separate living spaces for extended family members, such as elderly parents or grown-up children, homeowners can foster a sense of togetherness and ensure everyone's comfort and privacy. ADUs can range from 1000-1200 sq ft and offer one, two, or even three bedrooms, providing ample space for an entire family.

Additionally, downsizing has become a popular option for homeowners, especially when their children have moved out, leaving them with a large empty house. In such cases, building a smaller ADU for themselves and renting out the main house can be an ideal solution. This way, they can enjoy the benefits of a smaller, more manageable living space while generating rental income. Furthermore, if their children ever decide to return, the property remains available for them, making it a win-win situation.

For those who love playing the host and taking care of others, an ADU Guest Suite can be a fantastic addition to their home. This separate space signals their hospitality and provides a comfortable retreat for guests, showcasing the homeowner as an amazing host.

The financial benefits of ADUs are also noteworthy. Building an ADU can increase a property's value significantly. The average cost of constructing an ADU is relatively lower, ranging between $200-$300 per square foot, while houses in Southern California average between $400-$600 per sq ft. By adding an ADU, homeowners can effectively double or even triple their property's value, contributing to an increase in their overall net worth.

Moreover, thanks to new laws in California, homeowners have the legal right to convert various existing spaces, such as garages, basements, attics, tool sheds, and parking covers, into livable ADUs without unnecessary hassles or limitations. This accessibility opens up new possibilities for homeowners to make the most of their available space and resources.

Overall, the popularity of ADUs in California has soared due to the multitude of advantages they offer, ranging from financial gains through rental income and property value appreciation to fostering multigenerational living and accommodating changing lifestyles. With the flexibility of converting existing spaces into ADUs, homeowners can explore innovative solutions tailored to their needs and preferences.

With the new laws here in California you are legally allow to convert garages, basements, attics, tool sheds, parking covers to Livable ADUs. Feel free CONTACT US to schedule a complimentary consultation!

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