ADU Real Estate

Definition of "ADU real estate"

Written by

Tropical Sands Group (KW Elite) &
Tropical Sands Property Management LLC

KW Elite

ADU in real estate is an abbreviation for Accessory Dwelling Units. In everyday discourse, you might have encountered the term under the following nicknames: granny flat, backyard cottage, secondary (or auxiliary) dwelling unit, or in-law unit. What does ADU property mean? ADU stands for affordable, inventive, and efficient housing options in real estate. Many consider them practical solutions to address the housing shortage crisis.  

The building of ADUs calls for legal authorization.

Accessory dwelling units are connected to the concept of zoning land. The meaning of ADU in real estate defines a secondary home that is essentially located on the same lot as a single-family property. Families are zoned a single property lot. However, authorities passed a law in many states stating that homeowners can build an auxiliary house on the same land as the primary building.

Some states indeed allow the building of another home, yet counties have retained power over issuing actual permits. For example, they can restrict the secondary unit’s size and other particular aspects. In every instance, property owners and builders need to obtain the proper legal authorization from the local authorities! And how about the costs of building an ADU? On average, detached ADUs cost $100,000, covering all necessary permits, construction labor, and materials.

Why are ADUs so fashionable?

ADUs have become widely popular throughout the United States for five years. Let’s investigate the reasons behind their success. 

ADUs offer viable housing solutions for senior citizens

First and foremost, granny flats provide an excellent housing alternative for senior citizens replacing old folks’ homes. In addition, they can live independently. By placing a secondary residence on your lot, you can tend to your elderly and save on increased expenses. Facilities dedicated to retired people usually charge a high fee.

No more housing shortage with Accessory Dwelling Units

ADUs can effectively address housing inventory deficiencies, a hot issue in the US. Real estate prices went haywire, and few could afford new homes. Though real estate predictions for 2022 are moderately optimistic, there’s no denying fact that there are not many homes available on the market.

With ADUs, you can defend against the high cost of living.

Thirdly, many opt to build an accessory dwelling unit on their property because the cost of living is through the roof throughout the states. Such units can be attached or detached from the primary building or existing structure. 

Here’s some food for thought. Did you know that approximately 47 percent of the American youth still live with their parents in 2022? Families can put up their relatives, parents-in-law (as in an excellent mother-in-law suite), family members, children, and young adults before leaving the family nest, or even their favorite pets. Thus ADUs offer an economical way for every generation to get by.

You can rent out granny flats.

ADU owners can rent their secondary property depending on state legislation. Therefore, ADUs can become a passive income source. Suppose you plan on renting your auxiliary unit out. In that case, we recommend you install separate entrances, build kitchens, and renovate bathrooms belonging to the ADU. It all adds up to a wholesome livable unit where tenants won’t have to access or go through the central unit. 

ADUs boost your property’s value.

Considering such significant advantages, it’s no wonder that accessory dwelling units have turned out to be quite the goose laying golden eggs. You can use backyard cottages for various purposes, and each of them will save you money. That’s how we arrived at our final point: ADUs, by definition, can increase your property’s value. However, the construction should be first-class quality, complete with reliable craftsmanship. Besides, it must receive legal permits. Poorly constructed shacks without authorization won’t fly and won’t sell. 

Conclusion

Backyard cottages and secondary dwellings constitute a smart and trendy housing option. There are countless ways you can utilize them. Homeowners can accommodate parents, children, and guests. Then, you can use ADUs as a creative studio or rec room. And, you can also rent them out. Check existing city codes and regulations on building one (or even multiple) ADU in your backyard! What’s not to love about them? 

If you’re interested in additional details on ADUs and how they can add to your property’s worth, contact expert local real estate agents today!