4 Reasons to Build an Accessory Dwelling Unit
There are four common reasons for building an accessory dwelling unit. They include affordable housing, an increase in property value, and providing additional living space for a family member. The reasons for building an accessory dwelling unit are nearly as varied as the units themselves. Some people may need an accessory unit because they work from home, homeschool their children, or have elderly parents who are not quite ready for assisted living. Other people may build an accessory dwelling unit because they are college students or adults who have encountered career challenges.
Affordable Housing Option
Accessory dwelling units may be the answer if you’re looking for multigenerational or affordable housing options. These units are attached to the main house, often containing a bedroom, bathroom, and kitchen. They share parking spaces and yards. An ADU can be located in almost any part of a house, including attics, basements, and garages.
Adding ADUs to existing homes is a smart way to help solve the housing affordability crisis. The high housing costs in the United States have made homeownership out of reach for many people, leading to a shortage of affordable housing. In addition, many older Americans struggle to pay their home mortgages, and ADUs may be an affordable housing option.
A custom Accessory Dwelling Unit can be created as apartments within single-family homes or added onto existing homes. They can also be built as free-standing cottages on the property of an existing single-family dwelling. They are often cheaper to produce than multi-family homes and can be made faster.
Increase in Property Value
Adding an ADU to your home can increase its resale value significantly. Depending on your neighborhood and housing market, you may be able to add as much as 25 percent to 35 percent to the assessed value of your property. And, since the ADU isn’t a standalone unit, the increase in resale value is even more significant.
ADUs are secondary living units built on the same property as your primary single-family residence. They can be a separate, smaller home, granny flat, or secondary suite within a single-family dwelling. If you are considering adding an ADU, consider location and design. If it’s not in the right location, you could reduce the value of your property.
ADU permits are escalating across the US, and you should research local building codes and construction costs before deciding whether an ADU is a worthwhile investment. An ADU can add up to 640 square feet to your property. Building an ADU can range anywhere from $300 to 600 per square foot. You can also rent the space if you don’t need it yourself. An ADU can increase the value of your property by hundreds of dollars.
Increase in Property Taxes
If you’re considering building an accessory dwelling unit on your property, you should be aware of the potential increase in property taxes. It’s important to remember that reassessing your property taxes will be part of the process, as local jurisdictions want to maximize revenue from the development. Before you build an ADU, it’s essential to weigh the potential increase against the project’s benefits. In most cases, the added value of the ADU and its improved quality of life will outweigh the property tax increase.
When building an ADU, you can generate rental income from the unit and use it to house family members. However, many homeowners are concerned about the property tax increase that comes along with the addition. Fortunately, there are ways to reduce the property tax increase while maintaining the rental income from the ADU.
Provide Space for Family Members
Whether your family consists of one or many members, adding an ADU to your home can provide a convenient, affordable solution. In California, many families rely on these homes to provide extra space for family members. These units can be financed through the home’s equity.
ADUs are becoming a more common option because they can increase the value of your home. Buyers will appreciate a separate space and be more likely to offer you more money. Also, building an ADU is more accessible and less expensive than you think. Some kits for this type of home addition can be ordered online for as little as several thousand dollars, although some handwork is required for plumbing and electrical. Still, an ADU can be an excellent investment and add significant value to your home.
ADUs are typically tiny, self-sufficient homes built on the same property as single-family homes. They usually contain a kitchen, bathroom, and bedroom. They can also be used as a guest home, in-law apartment, or rental unit.