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What’s an ADU?

Granny flats, in-law apartments, casitas, guest houses, pool houses, backyard homes. Through time, these constructions have gone by various names. Presently, they are most frequently referred to in planning departments as accessory dwelling units, or ADUs. We founded ADORE Homes on the premise of making ADUs a life enhancer for households. Unlike many other products purchased throughout life, an ADU can really impact your family’s trajectory in many ways. Both financially and emotionally. This blog post will explore some of these impacts.

Many homeowners are turning to ADUs for the flexibility and benefits they can offer. Below, we chose to focus on three of them. We will share more use-cases in our next blog post.

Long-term lease — Become a landlord without giving up space in your house or even buying another property. Having an ADU, your rental house is where you can always keep your eye on it.

Short-term rental — Online short-term rental websites like and have become increasingly popular resources for travelers over the past few years. It has also been a lucrative choice for homeowners who have attractive living spaces near tourist destinations. The new state legislation affecting ADUs allows short-term rentals with a minimum of 30-day leases.  We see many healthcare professionals (nurses, x-ray technicians, etc.) as well as academic staff needing a place to stay for a short period of time.  ADORE Homes’ ADUs can be a perfect solution for those individuals.

Mother-in-law suite — If you’ve got an aging family member you will need to look after, an ADU can be a perfect solution. They could maintain their freedom with their own standalone house, but they could have family nearby when required. In addition, the COVID-19 lockdown and social distancing guidelines have created a new reality where you either isolate yourself with people who are physically living with you or you simply cannot meet these people, especially if they are in a risk group. Many of our clients have shown interest in getting an ADORE Homes ADU as soon as possible so they can move their parents next to them and continue to safely meet and take care of them. It is heartwarming to see the deep relationships within the family generations.

Why Are ADUs Gaining Popularity?

The surge in popularity of ADUs can be attributed to a blend of socio-economic and environmental factors. Foremost, as urban areas become increasingly populated, there’s a pressing demand for affordable housing solutions. ADUs, often smaller and cost-effective, present an accessible option for many. Additionally, they resonate deeply with families valuing multigenerational living; these units offer a sense of proximity while maintaining a degree of privacy. Beyond familial ties, homeowners see ADUs as potential goldmines for rental income, transforming their properties into dual-income sources. Environmentally, there’s a growing appreciation for compact housing. Smaller living spaces, like ADUs, require less energy for heating and cooling, leading to a reduced carbon footprint. Collectively, these reasons highlight the multifaceted allure of ADUs in contemporary housing discussions.

Cost and Financing of ADUs: How Much Does It Cost and How Can You Pay for It?

Diving into the realm of ADUs necessitates a clear understanding of the associated costs and financing options. The expenditure for ADUs can vary widely based on factors like location, size, and design intricacies. Typically, potential costs encompass design fees, construction expenses, requisite permits, and utility connections. Once one has a ballpark figure, several financing avenues emerge. Home equity loans leverage the existing value of your primary residence, offering relatively lower interest rates. Personal loans, albeit with higher rates, provide flexibility without tying the loan to your home’s equity. Furthermore, with the rise in ADU popularity, some institutions now offer ADU-specific financing tailored to this unique undertaking. Beyond the initial investment, it’s crucial to measure the potential return. Many homeowners find that the potential rental income from ADUs can significantly offset, if not surpass, the initial outlay, turning the unit into not just a living space but a lucrative asset. This dynamic interplay of cost, financing, and returns underpins the financial journey of venturing into ADUs.

Benefits and Challenges of Having an ADU

ADUs come with a unique blend of advantages and potential obstacles. On the positive side, ADUs can significantly boost the overall value of a property. This upswing in value is not just in terms of space but also the functionality and adaptability the unit offers. For homeowners, the promise of consistent rental income stands as a compelling financial incentive, making the ADU an investment that potentially pays for itself over time. Also, the personal benefit of providing a nearby home for aging parents or young adult children strengthens family bonds without compromising on personal space.

However, with these benefits come challenges. Maintenance can be a continuous commitment, especially if the ADU is a separate structure with its own utilities and systems. If rented out, navigating tenant relationships can present its own set of challenges, from ensuring timely rent payments to addressing concerns and conflicts. Additionally, introducing an ADU might shift neighborhood dynamics, leading to concerns about increased traffic, parking woes, or changing community aesthetics. Balancing these pros and cons, homeowners must make informed decisions about whether an ADU aligns with their long-term goals and vision for their property.

Regardless of what your reason is, an ADU provides you the choice to downsize your home to the unit and to rent out your principal home.

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