Granny Has a New Flat – Is an Accessory Dwelling Unit Right for You?

ESI Builders just completed a new granny flat in the Summit neighborhood of El Dorado Hills and our clients couldn’t be happier to have a place for Mom to call her own. Our clients were two middle-aged professionals with an immediate need for independent living space for an elderly family member living with them. The good news, they had enough yard space to accommodate a new 600 square foot Accessory Dwelling Unit (ADU) for their loved one.

ADU demand is growing. With more than 10,000 Baby Boomers turning 65 every day in the U.S. – the demand is growing for safe, convenient, and affordable senior housing near family members or care givers. Similarly, more than ever before, young people are staying home through or past college and many new college grads are again heading home to live with parents. This can be for brief or extended periods while they search for work and/or save money on otherwise avoidable living expenses like rent, utilities, and food. A final reason for growing ADU demand – rental income from others looking for affordable housing options; a great option to start creating passive income stream with your home.

Is an ADU right for you? There are several considerations for anyone thinking about adding an ADU to their property:

• Is an ADU allowed or possible on your property? Although California statutes and most cities and counties support ADUs — local restrictions by HOAs, building departments, utilities, and site conditions should be evaluated before moving forward.
• Size matters. ADUs less than 600 sqft typically have much lower permitting costs in most locations as this threshold can avoid school fees and other impact fees.
• What is the cost for an ADU? Applying the traditional cost for a new home (ranging from $250-300/sqft) will not typically apply to ADUs – which can be higher due to lesser economies of scale for small buildings, access to the building site and the removal/replacement of existing yard improvements. So consulting a designer and builder early is your best opportunity to set a realistic budget.
• How to pay for an ADU? Talking to a construction lender, banker or broker will be important in evaluating financing options – equity lines of credit, a second mortgage, or just plain cash can all be considered relative to the budget (and potential income).
• Designing for the moon or simple tastes. Like ADU size — the finishes, design, and amenities you select will impact cost and usefulness, so finding the right builder-partner to evaluate these items relative to your goals is a great first step in the decision.

Interested in learning more? ESI Builders is an experienced and quality builder in the Sacramento region and we would be pleased to work with you on developing an ADU, a home addition, a new custom home, or a luxury remodel. Give us a call at 916-939-9501 or contact us through our website.