Until very recently, an accessory dwelling unit (ADU) was not a term in the average person’s lexicon. But today, it seems like everyone is dreaming about or already building their own.
According to research from Freddie Mac, there are 1.4 million properties that have accessory dwelling units in the United States. The study also showed that first-time listings with ADUs grew, on average, at 8.6% per year over the last decade.
But what precisely is an ADU is and how much it will cost to build one?
Read on, and we’ll tell you everything you need to know.
What Is an Accessory Dwelling Unit?
An accessory dwelling unit is a fully functional living space that is not a direct part of the main house.
There are three categories of ADUs: interior, attached, and detached.
Interior means the dwelling is inside the primary home, like an attic or basement. Attached means that it is not part of the main house, but built as an attachment to it. Detached means that it is not touching the main house at all and is a standalone structure, like a cottage, shipping container, or shed.
The term accessory dwelling unit is relatively broad. It includes everything from converted garages to temporary construction to backyard home offices.
Why Build an Accessory Dwelling Unit?
According to ADU builders, the demand was rising before the Covid-19 pandemic. After being home for a year, many find themselves desperate for many different reasons, but one theme is to maximize space and increase home value.
An accessory dwelling unit can provide:
- a home classroom/study
- a home office
- a workspace (tattoo, hairstylist, massage therapist, etc.)
- an in-law suite
- a rental unit
- a way to age in place
- added value to the home
- multi-generational living
The options that an ADU can provide are undoubtedly vast with the caveat that there are rules and regulations which will be unique to your region.
Are Accessory Dwelling Units the Same as Tiny Houses?
To answer this question, we have to ask ourselves, what is a tiny house? In a nutshell, a tiny home is 400 square feet or less. There are two main types that we’ll touch on now.
Mobile Tiny Homes
If your tiny home is built on a moveable trailer, it’s legally considered a recreational vehicle (RV).
If your tiny dwelling has wheels, it will limit where you can park it. Recreational vehicles are illegal in most residential areas across the United States. RV parking or full-time living has strict regulations in many places, so you can’t just park your tiny mobile home anywhere you want.
Permanent Tiny Homes
A permanent tiny home is not mobile and, theoretically, could qualify as an ADU.
If you build a tiny home on the same property as the main home, for example, it could be an accessory dwelling unit. If you build a tiny house on raw land with a foundation, then it becomes a permanent home, and the rules change.
Additionally, the rules change state to state and county to county. So, before you make any moves, you should check in with your local laws and regulations.
In short, sometimes a tiny house can be an ADU, but not always.
Accessory Dwelling Units by the Numbers
By now, you may be thinking, ‘sure, that all sounds great, but what is this going to cost me?’ Unfortunately, the answer is not that simple. From building materials to labor costs to local laws, there are a lot of factors that must be taken into account. The following tools can help you to get a ballpark estimate for your particular project idea.
Get Example Quotes From Contractors
Contractors are usually more than willing to talk to you about what a project typically runs. But keep in mind, this is just a rough estimate. As with any building project, there is the potential to go over costs when the rubber hits the pavement.
During your research stage, you can talk to a handful of builders you are considering working with. Once you ask for example quotes, you can get an idea of potential costs.
Depending on where you live the numbers may vary a little, or a lot, just look at it as a general estimate.
ADU Cost Calculator Websites
Accessory Dwelling Unit calculator websites are the easiest way to get an idea of cost.
There are cost calculators for specific counties, like this one, for San Mateo County in California. If you live in California you can use this calculator to convert the values for whatever county you live in.
Alternately, if you live elsewhere in the country just compare labor costs. If labor costs in your region are less than they are in San Mateo, you know you have some wiggle room.
Costs to Consider
Consulting with builders and utilizing cost calculators are great. That is if you know what costs to anticipate.
To help you flesh out what to include in your cost analysis, we came up with the following list. It is not exhaustive but meant to get you thinking.
Potential costs you may incur include:
- excavation and leveling
- framing and other carpentry
- flashing and gutters
- interior finishings, including appliances
- site security during the build
- debris removal
- professional fees (architects, builders, legal team, etc.)
But don’t worry, there are certainly ways that you can save a few bucks here and there along the way. For example, you could opt for refurbished/used appliances. Additionally, you can plan to do some of the manual labor or finishing work yourself.
Accessory Dwelling Units Are a Sound Investment
There are many reasons to build an accessory dwelling unit. You may want to increase your property value or add a new income stream. Perhaps you want more space for extended family. Whatever the case, an ADU is a sound investment.
We hope that you can use this article as a jumping-off point in your data gathering stage. Now comes the fun part, fine-tuning your vision and making it happen.
Are you looking for more great ideas? Then make sure to check out the rest of our blog while you’re here.
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