Accessory Dwelling Units on the Rise
There’s a new-old real estate investment that’s spreading like wildfire through communities across the United States: the accessory dwelling unit, or ADU for short. Homeowners around the country are expanding their investment by becoming a part of a much larger ADU lifecycle — more on that later.
On the surface, it’s an idea so simple it’s been applied in different forms for hundreds of years; from castle wings to traditional bed & breakfasts to in-house guest rooms, the idea of adding extra space to houses for guests or renters is relatively timeless. Especially in the days of extended family members all living under a single roof, the guest cottage was a necessary addition to houses around the world — that’s why it’s often called a “mother-in-law” apartment, after all.
While decreased land value and widespread municipal zoning restrictions once made ADUs challenging to build, new legislation makes it easier for property owners to build ADUs.
Types of ADUs
There are two types of ADUs: the attached accessory dwelling unit (AADU) and the detached accessory dwelling unit (DADU). Both allow you a world of flexibility over the lifespan of your home. Attached ADUs are often built as basement apartments, in attics of single-family homes, above garages, or attached to the primary home as an addition. DADUs are backyard cottages or tiny homes that are separate from the main house, offering independent living and increased privacy. Check out Haas’ pre-approved DADU plans to see examples of the variety in DADU floor plans and designs.
Benefits of an ADU: The ADU Lifecycle
A primary benefit of an ADU is its versatility over time, often referred to as the ADU lifecycle. This concept highlights the many ways an ADU can be used throughout the years. For example, a young family might rent the unit early on, while later in life, the homeowner or aging relatives could move into the space. Under new ownership, the cycle can begin again. An ADU can provide meaningful value and flexibility throughout a lifetime of homeownership.
Example ADU Lifecycle:
A couple or a young family occupying a primary residence might build an ADU or DADU to rent short-term or long-term to other young professionals, students, or tourists through online booking platforms like Airbnb. This extra income from the rental property can help offset the costs of new homeownership.
Moving on into the adult child phase of life, “just getting started” offspring might use the ADU/DADU for a couple of years while they’re in college or launching their career. They might even stay into early marriage or until they can afford to buy a separate place of their own.
In the later retirement phase of a homeowner’s life, an ADU/DADU offers a way to stay in your house and neighborhood by helping to pay the bills with income from the unit. It also offers the option to host a caregiver for yourself as you live in the primary residence, and the caregiver occupies the ADU/DADU.
Eventually, the property owner can move into the ADU/DADU themselves, profiting post-retirement from tenants of the primary, larger residence. Seniors often find comfy, smaller spaces easier to manage, maintain, and move about. Even stairs can become a chore later in life — the final stages of the ADU lifecycle take that into account. As an ADU/DADU owner, you get to stay in the neighborhood where you raised your kids and enjoy the lifestyle you have come to appreciate and deserve, rather than moving into a high-density apartment complex or retirement home.
Outside the ADU lifecycle, there are also real estate ADU benefits. The opportunity to sell your DADU completely, condominiumize your backyard, and limit liability as the unit’s landlord. While this might not be your initial goal, you reserve the right as property owner if it makes sense for you to separate yourself from the backyard cottage and profit from the one-time sale.
Applying the ADU Lifecycle With Haas
Adding a backyard cottage to your home, or remodeling an existing space into an ADU, offers a unique opportunity to simplify and enhance your living situation, no matter what phase of your life. Our team of certified ADU/DADU specialists at Haas Development and Construction is here to discuss the benefits of an ADU on your property, so you can understand the full potential of your project. Get in touch with us today!
