It is no secret that the housing market is in a slump. Home prices have been falling for years, and many homeowners are struggling to sell their homes. We hear most often from sellers; one of the things we hear is, “I need more than one bedroom.” The truth is, there are so many benefits to adding an accessory dwelling unit (ADU) on your property!
What is an Accessory Dwelling Unit
I have had a lot of questions from potential buyers about accessory dwelling units this year. For those who don’t know what an ADU is, it’s a small living unit on the same property as your home that can be used for anything from rental income to an in-law suite or granny flat. Many homeowners choose to build their second unit to help pay off their mortgage faster by renting out the space. Others do it because they want more family time and separate living quarters for children, parents, grandparents, etc. Even some individuals decide to move into one of these spaces themselves instead of finding another place! I recently met someone looking for just such an arrangement. They were tired of their high-maintenance yard and large home but needed their own space.
How to Get Started with an ADU
Before you start thinking about building your new accessory dwelling unit, there are a few things that need to be taken into consideration! First of all, make sure you check your local zoning laws. Some cities allow homeowners to build secondary units on properties while others do not; you need to know where it falls within the city lines before getting too far along in the process. Also, keep in mind that some homeowner association (HOA) rules might prevent certain types of second structures from being built or rented out, so contact them first thing! Once you have confirmed what type of structure can go up next door, then design ideas! This is a great time to call in an architect and get some ideas going for your new accessory dwelling unit.
Why Should I Build an ADU on my Property?
One of the most important things about adding an auxiliary structure to your property is that it can add significant value! An interesting study from 2015 shows how much. According to this article, homeowners who have added second units onto their properties have seen values increase by 29%, more than double what they would see if they had not built any additional space at all. What’s even better is that many financial institutions will loan you money based upon these extra rental incomes, so you don’t need as big of a down payment when buying a second home or building one yourself. Since we are still seeing an increase in home prices this year, adding an accessory dwelling unit to your property can be one of the best ways to make money quickly.
Who Can Live in the ADU and How Much Does it Cost?
Just like any other living situation, there are rules about who can live on your property! Some homeowners choose to build their second units as independent housing spaces that will only house adults, while others allow college students or young professionals with roommates under certain restrictions. Of course, if you want to create a place where mom, dad, grandma, or grandpa can move out of the main house, they still need approval from them, too, so don’t forget! The cost is also different depending on what type of space you decide upon building, so contact my office directly if you want to find out more specifics.
In conclusion, if you consider adding an ADU to your property, be sure to weigh the pros and cons. The financial benefits of having one might outweigh any negatives that come with it. However, for some people, these types of units may not make sense from a lifestyle perspective. When deciding whether or not this is right for you, think about what’s most important in life and how much time you want to spend living on-site versus off-site.
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