ADU Construction: part 1

ADU Under Construction

As the population of San Diego and other California cities increase, more and more homeowners are considering building a second unit on their property. An Accessory Dwelling Unit (ADU) is called many names: granny flat, mother-in-law suite, guest house, pool house, etc. but whatever you may call it, the extra living space can bring a huge increase in functionality, usability, and equity of a home.  Recent changes to zoning rules and building permit rules and fees in most California Counties (including San Diego) have made the permitting of ADUs more feasible, cost effective, and schedule-streamlined than they have been in the past.

INCOME POTENTIAL: Building a rental unit on land you already own provides a great opportunity to increase your equity, and is an opportunity for passive income in the form of rent. Real estate is generally a steady flow of income if calculated correctly. Always budget for expected vacancy time and leave funds for necessary repairs and maintenance. A property manager can help you calculate income and costs before becoming a landlord.

MORE FLEXBILITY / INCREASED DENSITY: To combat the rising cost of living, some people are trending toward higher density living situations, either doubling up on roommates and living with friends, or entering into multigenerational living situations by housing an aging parent or relative. Having an ADU on a property greatly expands the options for these types of living situations.

PURELY FOR INVESTMENT:  ADUs can also make sense purely from the standpoint of return on investment.  In many counties like San Diego, with the recent changes to zoning and building permit treatment of ADUs, an investor can do well by purchasing an existing home that has the lot square footage required for an ADU, then renting the home during construction and selling the final project.  Ultimately, the outcome is a win-win for the investor and for the community as the project adds a home to a neighborhood greatly in need of additional dwelling units.

ADU under construction 2
ADU under construction 1

Leave a Comment