The Ultimate ADU Guide
Understand the Benefits of Investing in Your Property
Introduction
What do you see when you look at that garage in your home? What if there was an effective tool for exploiting your home’s full potential? The extra space in your home has many uses and may also be a potentially hidden goldmine.
This guide will reveal how converting your garage or additional space into an ADU (Accessory Dwelling Unit) adds value to your home and family.
Scroll through our guide or use the right-hand menu to navigate the page.
PART 1: The Basics of ADU Conversions in California
What is an ADU?
An Accessory Dwelling Unit is a secondary dwelling unit occupying the same lot or structure as a primary residential building. You may know them as granny flats, guest houses, mother-in-law suites, garage conversions. There are many terms that describe ADU’s.
From a legal perspective, the state of California defines an ADU as: “An attached or a detached residential dwelling unit on the same lot as an existing dwelling unit zoned for single-family or multifamily use that provides complete independent living facilities for one or more persons, including permanent provisions for living, sleeping, eating, cooking, and sanitation on the same parcel as the single-family dwelling is situated.”
Why Build an ADU?
Investment Property
ADUs are great avenues of earning passive income during harsh economic times, or generally in areas where the cost of living is high. You can optimize their economic potential by listing them out on sites like VRBO or Airbnb. Moreover, you can be a landlord and rent them out directly.
Increased Living Space
The need to increase living or working space in the home is another compelling reason for building an ADU. To illustrate, you can convert your garage into a home office or create an add-on to accommodate your aging relatives.
Types of ADU Conversions
Converted
The conversion of a previously non-livable space, typically a garage, into livable space.
Attached
An existing dwelling is adapted into two separate living spaces, each with their own separate entry. You can convert up to 50% of a primary dwelling space to be its own separate unit. A great example of this is making one large house into a duplex.
Detached
A separate dwelling that has been constructed on a property that often times has its own entry and exit. The most common Detached ADU’s are guest houses.
PART 2: Building with an ADU Contractor
In this Part, we will discuss briefly how to navigate the construction process from ideation to completion. We will also talk about the benefits of working with an ADU garage conversion contractor.
The General 4 Step Process for ADU's
Step 1: Architectural Plan & Design
When brainstorming garage conversion designs, talk with architects, builders, and sub-contractors about your conversion project. This will enable you to plan out objectives and schematics more thoroughly. When reviewing garage conversion prices, also speak with financiers and your contractor to work out a realistic payment plan. Moreover, your ADU builder can also work directly with local municipal zoning offices to make sure you’re building a legal garage conversion. Architecture is generally the first step and ADU Garage Experts can take care of this process, but if you already have architectural drawings, we can absolutely just do the engineering, permits and building steps.
Step 2: Structural Engineering
You will need to work with a structural engineer to ensure the safety and stability of your architectural plan. The structural engineer will ensure your ADU is structurally sound, safe, reliable, and durable. An engineer can look at your land, existing structure and more to verify a long-lasting and quality ADU conversion.
Step 3: Permits
The SB 1069 bill authorizes all local governments to approve ADU building permit requests if the ADU meets certain standards. This stage is critical since it guarantees preliminary planning review, building and safety reviews, and any special reviews required. This stage will ensure that your construction project is safe and a legal conversion.
Step 4: Construction
After finalizing all your fine details, collecting valuable ideas, and finalizing your budget, you can start constructing your ADU. Make sure you follow every detail during this stage since it can either make or break your architectural plan. Moreover, mark all important dates such as inspections, expected completion, and deliveries. Consequently, adjust your timelines to accommodate unexpected adjustments easily. Unlike a DIY construction project, working with a garage conversion company prevents small issues from falling through the cracks.
Costs & Financing
After finalizing all your fine details, collecting valuable ideas, and finalizing your budget, you can start constructing your ADU. Make sure you follow every detail during this stage since it can either make or break your architectural plan. Moreover, mark all important dates such as inspections, expected completion, and deliveries. Consequently, adjust your timelines to accommodate unexpected adjustments easily. Unlike a DIY construction project, working with a garage conversion company prevents small issues from falling through the cracks.
PART 3: ADU Rules and Regulations in California
Our first two Parts revealed the possibilities available with the underutilized space in your home. Here, this guide will discuss some state-specific regulations and rules.
Brief History of California ADU Laws
In January of 2017, Senator Bob Wieckowski (D-Fremont) and Assemblyman Richard Bloom (D-Santa Monica) signed a bill to ease the housing crisis in California by making it easier to construct granny flats or accessory dwelling units on your property.
By January 1, 2019, all homeowners with ADUs without the relevant building permits were expected to comply with these new regulations. The bill authorizes state building officials to inspect such ADUs and apply the building standards that were in force at the time of their construction. The bill, SB 1226 (Bates), adds Section 17958.12 to the California Health and Safety Code and allows the issuance of construction permits for the residential units.
ADU Requirements & Permissions in California
California allows homeowners to construct ADUs by attaching them to existing dwellings, locating them within existing habitations, detaching them from the current residences, and locating them on the same lot as the existing buildings.
Size & Space
The law requires all detached ADUs to be at least 10 feet from the main residence and 5 feet from any property lines. Also, the maximum size of an attached granny flat should be 1,200 square feet if detached or half the size of the existing residence, if attached. However, some cities require smaller granny flat sizes. To illustrate, Santa Monica, limits the maximum size of all types of ADUs to 800 square feet, while Glendale fixes it at 600 square feet.
Building Materials
The law permits homeowners to build ADUs using a cost-effective wood frame.
Lot Size
Legally, any lot with a single-family house can have an ADU.
Exceptions
Even with statewide regulations, some laws apply differently across various jurisdictions. Therefore, they have leeway to legislate their own requirements, such as determining the legality of short-term vacation rentals, whether owner-occupancy is a requirement and maximum ADU size. Check with your local jurisdiction regulations or with a garage conversion company before proceeding. Or, contact us and we can help you determine the best way to build your ADU!
Parking
Legally, homeowners in Los Angeles should add a two-car parking area if they convert their garage, plus one-car parking for the ADU. However, they can locate it anywhere within their compound. The parking can also be on the existing driveway in tandem, as open parking.
- Parking spaces must be 7.5 ft x 15 ft.
- Parking for an ADU is unnecessary if you live within half a mile of public transit. However, there still needs to be two parking spaces for the house.
- Parking for an ADU is not required for historic district dwellers.
- Parking for an ADU is not required if the unit is included within an existing primary residence or if a car car-share is located within one block of the residence.
Common Obstacles
There are a few obstacles that you might encounter when buiding an ADU.
- Red tape
- Minimum lot sizes
- Restrictions on the number of floors
- Home Owner Association restrictions
- Owner-occupancy requirements
With all of these obstacles in mind, it’s helpful for those wanting to construct an ADU to get help with the permits and building from an established structural engineer and ADU builder.
PART 4: ADU Costs & Increased Values
Does building an ADU add any value to your home? This Part answers this question broadly, but in short, yes.
According to Trulia, a real estate website, the average value per square foot of a residential home in Los Angeles is $682. Based on this average, a garage conversion can add up to $272,800 of value to the average home ($682 x 400 Sq. ft.).
Cost Benefit Analysis
Even though it costs you to construct an ADU, the benefits greatly outweigh the expenses. For example, you can market your property to travelers on Airbnb, VRBO, and HomeAway to earn a passive income. However, you should remember that short-term rental regulations vary across jurisdictions. Therefore, factor in this cost implication before listing your property.
However, there are some beneficial tax write-offs that come with rental properties, such as:
- Cleaning and maintenance
- Utilities
- Property Repairs
- Mortgage loan interest
- Property or private mortgage insurance
- Depreciation of ADU structure over 27 ½ years
Long Term Investment
You can also reap long-term investment from your ADU addition through monthly or annual leases. As a landlord, this passive income essentially pays back the cost of building an ADU.
Home Resale Value
ADUs can raise your home’s resale value. For example, if you construct a detached rental ADU and optimize its economic potential, you will be selling a business the day you sell your home. This means a higher return on your investment.
Family Value
Everyone’s family situation varies. In high-cost areas in Southern California, aging parents may no longer be able to afford their home or an apartment. ADUs provide people with the flexibility to ease finances and create comfortable bedrooms and apartments for family.
Personal Space
A garage to room conversion can be whatever you want! Maybe you’re an artist converting a garage into a studio, or just wanting to improve your work-life balance by converting an ADU to office space – ADU conversions offer unlimited potential. Additionally, working out of your ADU conversion may also qualify you for certain tax write-offs.
ADU's Benefit Cities and Communities
While the benefits of ADU conversions for homeowners are pretty obvious, there are also major-community and environmental benefits as well. The three main ways in which ADUs benefit Californian communities and cities include:
Economic
ADUs provide much needed housing in Los Angeles, where there is currently a housing shortage that is making housing inaccessible to many who need it. ADUs use existing governmental services — such as sewers, roads, schools – and reduce the demand for additional and expensive infrastructure.
Environmental
ADUs provide housing with a small environmental footprint for people whose needs are met by a small living space. New ADUs provide rental housing that is 33% to 44% smaller per capita than standard, new single family rental units. This means new ADUs provide housing at a fraction of the cost of energy in the construction, deconstruction and habitation over typical single family rental units.
Social
ADUs provide more housing options in family-oriented neighborhoods without dramatically changing the overall character of the neighborhood as newly constructed single family apartment buildings would. Plus, ADUs help keep families together and provide options for home owners to stay in their own home. Some empty nesters build ADUs and move into the unit themselves, renting out the main home.
Ready to Build Your ADU Conversion?
ADUs are invaluable additions with many social, economic, and environmental benefits for communities, cities and homeowners. Completely customizable and based on your needs, ADU Garage Experts seeks to create a seamless and simple construction process.
Although California supports homeowners’ desires to profit from legal accessory dwelling units, people need to know the unique laws that apply in certain jurisdictions.
Homeowners will face certain challenges during construction, which is why hiring the experts in ADU garage conversion is necessary for getting the biggest return on investment.
Ready to explore the full social and economic potential of an ADU garage conversion?
Contact us at 310-553-9339 for a free consultation and estimate.