Perhaps you’ve seen them. They look like an apartment over a garage or a permanent tiny home in someone’s backyard. Perhaps you’ve even noticed basement apartments with walk-out patios. Whatever form they take, these accessory dwelling units – ADUs – are rapidly increasing in popularity. They’re especially common in crowded cities where housing is already in short supply. They’re the top request for contractors, but why does everyone want an ADU? To understand why the demand keeps growing, you must know a bit more about them, first.
What Are ADUs?
Accessory dwelling units, or ADUs, are self-contained living spaces. By definition, they sit on properties with a separate main, single-family home. Often referred to as in-law units, secondary suites, or mother-in-law suites, ADUs enjoyed their first popularity spike in the 1900s. These secondary spaces came in handy during the Great Depression and the housing crisis of 1929.
After World War II, zoning regulations began to complicate the process of adding ADUs to existing homes, so they eventually became less common. Many municipalities even banned ADUs to support the shift to suburban development. Recently, however, rising home prices and tight budgets have persuaded many government entities and advocacy groups to publicly support ADUs. In the wake of the pandemic, several states even enacted legislation to promote them.
On January 1, 2020, California passed the most lenient one of all, allowing two types of units: the standard accessory dwelling unit and the junior ADU. These units can be attached or unattached to the main house, allowing homeowners the freedom to choose the layout and design for maximum accessibility.
The Benefits of Having an ADU
Though adding an accessory dwelling unit is an old idea, it’s just as brilliant today as it was 100 years ago. Perhaps that’s why so many people want an ADU. There are myriad reasons to add the unit to your home. If you have the yard space, you might consider building one, even to reap just one of the following benefits.
1. Provides Affordable Housing
Affordable housing is hard to come by, especially in hot spots like California. Recently, an increase in accessory unit construction has offered some hope. In 2018, the state issued just 6,000 ADU permits. The following year, it issued nearly 16,000.
Now, many municipalities are boosting ADUs as part of affordable housing and anti-displacement plans. Cities like Santa Cruz and Los Angelos are helping lower-income households find reliably affordable housing with these functional property add-ons.
2. Can Earn Passive Income
Aside from benefiting the community, building more ADUs can also benefit homeowners who want to help out family, friends, and even strangers. Households can easily rent out the unit on a yearly, monthly, or even weekly basis by listing it for less than surrounding apartments. If you want to supplement your income further, you can rent out your main home and live in the accessory dwelling.
Another great way to earn passive income with an ADU is by using it to host events. Perhaps you’d love to teach yoga or practice your photography skills on the side, but don’t have time to get a second job. Why not turn the unit into a studio and host classes, workshops, and shoots during your free time?
3. Allows for Flexibility
It’s evident that accessory dwellings have major potential to earn income and support the local community. But even ADUs that never generate revenue are still valuable in improving folks’ quality of life. Why? Because they’re flexible and capable of transforming with a family to best suit their needs.
As of September 2020, more than half of young adults were living with their parents, surpassing the previous peak during the Great Depression era. An ADU would allow for more privacy and personal space during such long-term living arrangements. Once their children move out again, they can convert the unit into an art studio or weekend getaway. Perhaps they’ll even use it as temporary storage space or a place to house their own parents as they age and require hands-on assistance.
4. Boosts Property Value
Because ADUs have only recently enjoyed a popularity rebound, there’s little data as to whether ADUs boost property value. However, some earlier studies, including one from 2012, suggest these dwellings contributed to about 25-34% of a property’s assessed value. They also demonstrated an average 51% increase in resale value, and that was 10 years ago.
These days, peoples’ values have shifted and ADUs are in even higher demand, which means they could boost property value even more.
5. Better for the Environment
Regardless of where homeowners build ADUs and how they use them, these tiny dwellings are much better for the environment than full-scale single-family homes. American homes are among the biggest in the world, with new houses averaging 2,200 square feet. These large spaces require more land to build and more energy to function.
Meanwhile, the average U.S. household size continues to decline. Now, roughly two in three households are childless, which means there are fewer people living in more spacious environments. Ultimately, these single-family homes generate a large carbon footprint, a steep price to pay for an unnecessary amount of elbow room.
Luckily, ADUs are smaller and require less energy, so they’re more affordable and eco-conscious. Some are even net-positive dwellings, meaning they benefit the environment by simply existing.
How to Get an ADU
If adding an accessory dwelling unit to your home piques your interest, there are a number of factors to consider before calling up a contractor and sharing your plans. Home renovations require sweat equity, time, and money, so they can represent a hefty investment. However, they do offer promising returns, so you must weigh the pros and cons before committing to a weeks-long or months-long build.
While ADUs are legal and encouraged in many states, putting one on your property requires a permit. You must obtain one before putting hammer to nail to ensure your plans comply with footage and height restrictions, green construction requirements, and other design criteria. Otherwise, the state government or your homeowner’s association or landlord may charge you with fees and fines for breaking local ordinances and building codes.
When it comes to what you can and cannot build, every neighborhood is different, so do your research and be proactive about seeking licenses and permits. The sooner you can get all the paperwork out of the way, the sooner you can get to building the ADU of your dreams.
In case you have any architectural, structural, and MEP design requirements, or need full multifamily conversion design including structure, and HVAC design, feel free to contact us. We provide you with the full permit set design + T24 for your request.
Rose is the managing editor of Renovated. She’s most interested in sharing home projects and inspiration for the most novice of DIY-ers. These are the values she developed growing up in a family of contractors.