Accessory Dwelling Units (ADUs) are becoming more and more popular and it’s easy to see why. With the cost of housing increasing, the price of rent increasing, the high monthly payments for senior care, and the new normal of working from home, an Accessory Dwelling Unit just makes sense. Here are 6 great uses for an Accessory Dwelling Unit on your property.
Rental Income – For many homeowners, the biggest hurdle for purchasing an Accessory Dwelling Unit is the price. Many ADUs start at around $250,000 and we admit, that is an investment. But think about this: how else can you purchase a home for less than $300,000 in California!?! The great thing about purchasing an Accessory Dwelling Unit early on is that it can pay for itself before you need it. For example, if your children are still young, you could build an ADU and start renting it out. In many circumstances, the monthly rent will cover the cost of the unit and by time your children are grown, much of the ADU could have paid for itself. (Please discuss your equity, mortgage, and potential rental income with a real estate professional and mortgage lender before making any decisions. Each situation is unique!)
Now let’s say that your children don’t end up needing your Accessory Dwelling Unit and it’s paid for. Wouldn’t it be great to have another income stream in your retirement years? Currently an ADU could be rented out in the San Francisco Bay Area for about $2,000 – $3,000 per month. That could be a great source of income down the road! (Again, these numbers vary depending on ADU size, location, and market fluctuations.)
Home for Your Kids – Since we just mentioned your kiddos, an Accessory Dwelling Unit is a great place for them to become homeowners or to save for a home of their own. They could a) build the ADU on your property and own it. Down the road you could either buy it back from them and rent it out or you could sell it to your aging parents to help them downsize and to have them close to you to ensure they’re taken care of. This is a way for your grown kids to build equity instead of throwing away money on rent.
Caring for Aging Parents – And speaking of senior parents, it can cost anywhere between $2,000 to $5,000 per month for seniors to live in a senior care facility. This doesn’t include assisted living facilities with medical staff and care! Many times it costs less to build an Accessory Dwelling Unit than it does to live in one of these elder communities. If your parents are still active and healthy, an ADU gives your parents a separate, defined living space while you also have your own privacy. However, with them just across the yard, you can easily check in on them and take them to doctor’s appointments and ensure their physical and mental health.
Home Office – COVID-19 is nobody’s friend, but one good thing that came out of it was the ability to work from home. Living in the SF Bay Area, I’ve had several jobs where I would commute as far as an hour and a half each way! And can we take a moment to mourn the many hours of our lives wasted in traffic (Highway 4, I’m looking at you!). Now we can take back those hours of our lives and invest that time into getting healthier, watching our kids grow up, and being less tired and cranky. However, it’s not all smiles and finished spreadsheets. Working from home also means you can’t leave stress at the office, pause a messy project halfway through for fear a kid will refile your paperwork, or invite clients over without worrying that the house is a mess. With an Accessory Dwelling Unit, you get the best of both worlds! You can commute to the backyard (if you have a dog, he may be your new traffic jam), close the door on the day when you leave, and you can have clients visit without interrupting your private life. This could also be an amazing tax write off! (Discuss this with your tax professional first!)
Hobby Room – What do you like to do in your spare time? Work out? Craft? Are you an artist? Do you love yoga? Imagine having your own room (with bathroom, a mini kitchen, air conditioning, and storage space!) to do whatever you want. It could be your gym to store all of your weights and equipment. It could be the ultimate craft room to house your papers, Cricuts, glues, and pens. It could be a studio for you to paint in or create clay masterpieces. It could be your serene oasis to escape from the world and just breathe. It can be anything you want it to be! Heaven!
Guest House – Do you have friends or relatives that have moved out of California? We all have! An Accessory Dwelling Unit can be an incredible place to house guests. Maybe it can be your home office or work out space during the rest of the time, but come summer or the holidays, you can share it with your extended family! This is the perfect solution because they have their space and you have yours! (No one wants to see grandpa in his boxers!)
Are you thinking about purchasing an Accessory Dwelling Unit? Call ADU Warehouse today! We have a variety of sizes, floorplans, finishes, and price points to choose from. And you know how we mentioned talking to real estate professionals and lenders before you make any decisions? We partner with amazing local Realtors®, insurance brokers, lenders, and landscapers so you get exactly what you want. Call us today! We’ll talk about how YOU want to use your Accessory Dwelling Unit and together we can come up with a plan for your unique situation. Call us today. We can’t wait to serve you!
