What is an ADU?
According to the American Planning Association (APA), an accessory dwelling unit (ADU) is “a smaller, independent residential dwelling unit located on the same lot as a stand-alone (i.e., detached) single-family home.” ADUs can be internal, attached or detached.
- Internal ADU (aka Conversion ADU): A converted portion of an existing single-family home. Though the ADU is located within the home and typically shares utilities with the main portion of the home, an internal ADU is, for all intents and purposes, its own self-contained living space that is isolated from the main home.
- Attached ADU: A self-contained living space that is constructed as a physical addition to an existing home, attached to the main house by at least one common wall. This type of ADU is contained within the footprint of the original structure and typically may not exceed half of the square footage of the main home. This can vary between jurisdictions.
- Detached ADU: A separate standalone living space that is typically permitted to be constructed on both single-family and multiresidential properties. In California, a detached ADU can typically be up to 1,200 square feet, under 16 feet tall and must have rear and side setbacks of at least 4 feet.
Specific requirements for ADUs
The type of ADU you choose depends on several factors, including the size of your property, your area’s zoning laws and your intended use of the ADU once it’s constructed. Read more about these considerations below.
- Must contain at least 150 square feet of living space plus a bathroom
- Must contain a kitchen and bathroom
- Must be built upon a permanent foundation
- Utilities can be turned on and off without entering the primary home
An ADU by Any Other Name…
While you may think that you’ve never heard of ADUs, chances are you have and just don’t realize it because of all the other monikers floating around out there. While ‘accessory dwelling unit’ is the technical term for these additional structures, they’re also commonly referred to as granny flats, backyard cottages, tiny houses, mother-in-law suites, guest houses, carriage houses and even basement apartments.
Some of these terms conjure up images of a cute little cabin or tiny-home living, while others evoke cringy basement-dwelling vibes. They all, however, amount to the exact same thing: extra living space.
- Accessory apartment
- Accessory suite
- Accessory unit
- Ancillary unit
- Dawdy house
- Garage apartment
- Garden cottage
- Garden suite
- Granny cottage
- Granny pod
- Granny unit
- In-law suite
- In-law unit
- Laneway house
- Mother-in-law flat
- Mother/daughter house
- Multigenerational homes
- Ohana unit
- Pool house
- Secondary suite
- Second unit
- Secondary unit
- Secondary dwelling unit
- Sidekick
The Difference
With all of these different names being thrown around, how do you tell which ones are legit ADUs? It can be boiled down to a few simple things:
- Is it meant to be slept in?
- Does it have a kitchen?
- Does it require a building permit?
Answering yes to all of these questions means that your external structure is legally considered living space, and as such, it’s an ADU. A few other legal points:
- This living space can now be covered by your homeowner’s insurance
- You can legally rent out this space
- This space is added to your property’s record with the county
- A detached ADU gets its own address
Benefits of ADUs
While building an ADU is a significant investment, there are many ways that the project can provide an even more significant return on your investment over the long term. Of course, your return depends on how you ultimately decide to use your unit.
Rental Income
Many homeowners choose to rent out their ADU as a way to earn additional income. While this plan works great for most, there are plenty of aspects to consider before becoming a landlord.
Ease Housing Shortages
Renting out your ADU not only allows you to earn extra income but also gives members of your community an affordable housing option.
Increased Property Value
Done well, adding additional living space will increase the resale value of your home. Detached ADUs can provide an especially hefty return on investment when you sell your property.
Extra square footage
Your ADU can be utilized for guest accommodations, a home office, photography studio, gym, storage or any other usage you deem appropriate.
A home for family members
For grown children, aging parents or even caregivers, an ADU is a great way to have them close by while providing them the privacy and autonomy adults need.
Retirement
When you retire, you could consider downsizing to your ADU and rent out your main home to earn the income needed to sustain your retired life.
Reduced environmental & infrastructure impact
By adding an additional housing unit to your existing property, you’ve eliminated the need for another home to be built on land that would need to be cleared of vegetation and wildlife habitats. Collectively, this can help reduce the need for infrastructure expansion (roads, utilities, etc.).
Things to Consider
While there are many benefits to adding an ADU to your property, there are also factors that should be considered carefully before beginning the process.
Zoning, Laws and Regulations
First and foremost, homeowners looking to add an ADU should research the legalities of such an undertaking in their locality. Unauthorized building projects can be subject to code enforcement fines and could also cause significant issues if the owner ever decides to refinance their property.
Since the start of 2020, California state laws around ADU construction have been significantly relaxed, meaning that most single-family properties are legally allowed to have an ADU added. Local restrictions apply and typically include the following:
Setbacks
Setbacks are defined as the required minimum horizontal distance between the front, side and rear edges of the lot to the building. A minimum distance between the ADU and the main house also applies, and depends on the local zoning laws.
Lot size
While there are currently no specified lot size requirements for existing lots in the state of California, any newly-created lot must be in compliance with local zoning regulations. Obviously certain lot types are more desirable in terms of layout and privacy.
Size of ADU
Size parameters include the maximum height of the ADU as well as the minimum and maximum square footage of living space.
Pedestrian pathway size
Pedestrian pathways must be a minimum of three feet wide by seven feet tall.
Utilities
Most localities allow for utilities to be shared between the main home and the ADU, but it’s always prudent to check with your local zoning department. Owners who wish to rent their ADU can invest in submetering for ease of utility billing – a less expensive option than having new connections established. If your main home is older, you may need to upgrade your main electrical panel to support a second unit.
Solar energy
Beginning in January of 2020, all livable residential buildings constructed in California must contain solar backfeed systems. Newly-constructed detached ADUs must have solar panels installed either on the ADU or on the primary residence; attached ADUs or ADUs constructed within an existing residence are not required to have solar panels installed.*
Parking
Each ADU must include one parking space (8’8” x 18’). Exceptions include the following:
- The property is located within a half-mile of a bus stop or train station
- The property is located in a historic neighborhood
- The ADU is attached to the main home
- On-street parking is allowed with a permit
Additional Considerations
* Some cities/counties only require a solar-ready system, but others require a complete functioning system. Check with your local code enforcement office.
** Always check with your locality’s zoning department before beginning any project to ensure you remain in compliance with local laws and regulations.
ADU Costs
The costs associated with your ADU go beyond the initial build. You’ll have ongoing maintenance, possibly increased property tax costs, the cost of furnishing the unit, and more. While we can forewarn you about common construction-related costs, you must remember that as a homeowner, you’ll have some of the same types of upkeep-related costs with your second residence, and maybe even some new ones.
Generally speaking, the total cost of your ADU project will be determined largely by the type of ADU you’re having built. Here’s an overview of the types of ADUs, ranked from least expensive to most expensive:
- Basement ADUs
- Garage conversions
- Above-garage new construction
- Attached new construction
- Detached new construction
Local ordinances will determine which types are available to you as an option. Talk to your contractor to ensure you’re making the best choice based on zoning, budget and available space.
Below are some of the costs associated with having an ADU erected on your property, as well as variable costs to maintain the new structure. Some costs are self-explanatory, while others might surprise you.
Upfront Costs
Contractors will generally give you a price quote based on a per-square-foot pricing matrix. They’ll usually base this price on the current costs of the materials, labor, permit fees, and other costs to complete the project. Keep in mind that this price can also include development and impact fees (per California law) if the ADU is more than 750 square feet. The price quote for your ADU construction will vary between contractors and is just one consideration to take into account when choosing a contractor for your project.
Your total cost will also be greatly affected by the finishes, furnishing and appliances you choose. Upgrades throughout the space will add up to a much greater price tag than a basic set of finishes.
Unexpected Costs
If your property has certain conditions that require additional preparation or retrofitting in order to properly and safely build your ADU, your costs may increase. This is generally unknown to the contractor until site preparation begins and potential issues are uncovered. .
Additionally, many homeowners don’t realize that the direction of expansion matters. If you’re expanding your garage to convert it to an ADU, it’s less costly to expand out of the front or back than it is to expand the sides. This is due to two main factors:
- The side walls are load-bearing; you’ll have to put in a lot more work (and expense) to reinforce the new exterior wall to sustain the same load-bearing capability. If you expand out the front of the garage, it’s less costly to demo, since there’s already a huge opening, and you don’t have to worry about replacing a load-bearing wall.
- Expanding to the side means you’ll need to add a gable for the roof addition. Pitched roofs can be extended in the direction of the pitch easily, while expanding to the side requires more materials and labor to execute.
Maintenance Costs
As a fully functioning living space, your ADU will require much of the same maintenance as your main home. While these costs can stretch your budget, it’s better to bite the bullet and keep your homes maintained than to neglect the necessary upkeep, as it will cost much more in the long run to repair and replace a part of your home that you’ve failed to maintain.
- Roof inspections/repair
- Landscape maintenance
- Appliance upkeep
- Sidewalk/driveway/steps upkeep/repair
- Plumbing inspections
- Smoke alarms
- Chimney maintenance
- HVAC-related expenses
- House painting/residing
This is not an exhaustive list, of course, but only meant to provide a reminder of all the seemingly small tasks needed every year to keep your home in top condition. Failing to maintain your structures can pose serious safety hazards, decrease the value of your property and even cause your city or county to issue fines.
Tax Implications
When you build an ADU, your entire property is not reassessed. Instead, the new-construction portion (the ADU) will be assessed and added to your property’s existing value. In California, property taxes generally run right around 1% of the property’s assessed value, so when the ADU is assessed, 1% of that value will be added to your tax bill. While this rate can fluctuate from year to year, Prop 13 has capped property taxes at 2%.*
As an example, let’s say your new ADU is valued at $100k. That’s $1k in annual property taxes, or $83/month, added to your tax bill. If you’re renting out your ADU, the rental income will more than cover the tax increase (and likely the basic maintenance, too).
*Check with your locality to get the most up-to-date information regarding your ADU’s tax implications.
Construction Timeline
As with any construction project, the time it takes to build an ADU varies depending on the various factors associated with the project. Though our team does our best to minimize the length of time a project takes to complete, certain factors are out of our control and can affect the project timeline.
Overall, most ADU projects can be completed within 5-10 months, provided there are no serious setbacks or delays. Typically, this timeline can be broken down as follows:
Time Factors
- Permitting
- Weather
- Material availability
- Supply delivery delays
- Size, scope and complexity of the project
Consultation, Design, Contract: 4-8 weeks
A lot of work is done at this initial stage. During our consultation, we’ll need to research your property information to determine if building an ADU is lawful according to your local zoning laws. Then, we need to determine the basic design features you have in mind in order to present you with an initial budget estimate.
Next, you will work with the drafter to design your ADU. We typically provide a 3D CAD rendering of your project so you can get a good idea of how the final outcome will look. While this step is being completed, we’ll be gathering information to put together a more detailed project budget. This can include permitting fees, material pricing, utility tie-ins, etc.
Engineering & Permitting: 8-16 weeks
Once the design is done, it must go to the engineering team so they can create the detailed construction drawings as well as all the necessary calculations to ensure safety and code compliance. The drawings are then submitted to the local building department with the permit application. The department will either approve the plans or send them back for revisions before issuing the necessary permits. As with any bureaucratic process, this takes time.
Construction & Delivery: 8-16 weeks
This stage is when you begin to see tangible progress. With the proper permits in hand, we must prepare the site for building, which includes grading, foundation pouring and utility work. Once prepared, the building will begin.
Once the building is done, the site cleaned up and the county inspections passed, the completion of the project is officiated by the issuance of the certificate of occupancy. This important document permits the structure to be occupied, provides its unique address and provides the necessary information for the county assessor to update your property records.
ADU Case Study
Promodeling, Inc. recently completed a garage conversion ADU project for a homeowner in Berkeley, CA who wanted to utilize the space for visiting family members with the possibility of renting it out in the future.
Read Our ADU Case Study