10 Reasons Why You Should Start Building Your ADU Property

Have you been thinking of your next home improvement project? A paint update? New flooring installation? Or bathroom remodel, perhaps? Well, if you’ve already ticked these home remodeling projects off your list, we believe it’s time to build your Accessory Dwelling Unit (ADU). Building an ADU is a life-changing home upgrade that—unlike the ones mentioned above—requires time, money, and effort (a lot of it). To help you see the overall benefit of having an ADU, here are 10 compelling reasons why you should start building one.

1. ADUs produce a high return on investment

We have to admit the fact that ADUs are a good investment. Even though its monetary rewards may not soon be realized, the possibility of it bringing in a continuous flow of cash is high. Imagine spending around $50,000 to $100,000 for your garage conversion and let’s assume you’ll earn up to $42,000 for the first 5 years, that’s already a 16% annualized ROI (this is an estimation only). To gain this much, you need to evaluate everything carefully and don’t hesitate to communicate with your ADU builders.

2. It helps resolves California's housing crisis

The city of San Jose has been well aware of the prevalent housing crisis in the area. To resolve this, housing regulations and city ordinances have been recently amended, letting more property owners easily build their ADUs. Now that the city has updated the rules, don’t you think it’s also time for you to decide on this too?

3. Can be used as an office space

The work-from-home arrangement is part of the “new normal”, which means houses turned work stations will also be this year’s trend. One good way to keep your creative juices flowing minus the unnecessary distractions? Build an ADU and use it as your home/office area.

4. Increases your house's resale value

Adding an ADU is one of the best ways to curb your house appeal. And when we say curb its appeal, we mean boosting your home’s worth and making it visible to the market.

5. Good source of (passive) income

An ADU investment can potentially bring in a substantial amount of income to the household. Amid this time of uncertainty, it is always wise to create an additional avenue of earnings—making a profit out of your assets.

6. Builds strong family ties

Adding extra property can also mean having more space for your family and loved ones. Having an ADU can help keep the family intact while still holding boundaries and letting the other party have their privacy. 

7. Can be a short-term investment

Who says renting out your ADUs are for long-term investors only? Homeowners who are keen to pay down their initial investment may opt for short-term tenancy. They can scout for short-term occupants, having 4 to 5 tenants per year.

8. Or a long-term investment

This is the total opposite of the one mentioned above. ADUs rented out for long-term tenancy best suits homeowners who’d like to make time as an indispensable factor for their property investment.

9. Helps the environment

Did you know that by building an ADU, you help minimize your house’s carbon footprint? Apart from resolving the housing crisis, ADUs can also contribute to environmental problems—it’s material-efficient, water-efficient, and energy-efficient because of the compact living situation it promotes.

10. Spices up your facade

It wouldn’t be called an “accessory” for nothing. ADUs are created to liven up your house’s aesthetics—an additional touch up that goes a long way.

Sources/references:

http://bloomingrock.com/2015/10/22/5-reasons-to-build-an-adu/

https://actonadu.com/blog/5-reasons-why-an-accessory-dwelling-unit-is-perfect-for-your-boomerang-kid

https://maxablespace.com/cost-to-build-a-granny-flat-san-jose/

https://www.rostarchitects.com/articles/2019/10/15/five-benefits-of-building-an-adu-on-your-property

https://www.housable.com/adu-guides/why-add-an-adu