Brooks here, and I know there are so many “solutions” floating around out there that make some pretty astounding claims when it comes to additional income. You have everything from makeup to essential oils to Ponzi schemes. Let’s go through what an ADU is- and isn’t.

So what makes ADUs any different than say a timeshare?

Simply put, an ADU is a second living space created on a single-family residential property. It is considered an accessory to the primary dwelling space. An ADU is not an apartment or condo where you pay rent for time.This is referred to by city ordinances as an Accessory Dwelling Unit.  You most likely have heard of this as a basement apartment, an attic apartment, a garage apartment, mother-in-law suite and many other names. You can read more about the history of ADUs here.

Where have ADUs been successful?

ADUs are very successful in areas where affordable housing is difficult to find. They have made a big difference for those who seek a quality and affordable living space and for those who seek a supplemental income.  In areas in California, like San Francisco, Los Angeles, San Diego etc,  ADUs utilized as short-term rentals, additional long-term rentals in upscale neighborhoods, and housing solutions for the homeless. In Portland and Seattle they have also been a great success, especially to add new growth to older, established neighborhoods.

When did ADUs start becoming more popular?

The municipal adoption of ADUS has grown rapidly in areas where affordable housing has become an issue. That is why they have been popular in California cities for nearly 20 years, and in the Portland area for about 10 years. You can read more about Seattle’s growth here.

Who would benefit from using or investing in an ADU?

There are in general two reasons for investing in an ADU. First, it generates supplemental income. Let’s be honest, many of us can use that. This income can be invested into your retirement, or in paying off your own home early. The options are limitless.  Secondly, ADUs allow you to assist family members with housing options. In the long run, ADUs are fair less expensive than long-term housing for aging relatives, like nursing homes or assisted living apartments.

Why is an ADU a solid investment?

Housing will continue to be a growing challenge in metropolitan areas. Growth of an economy in metropolitan area is directly related to expansion. That means more work, more jobs and more need for workers mean more need for housing.  Metropolitan areas are not creating more land!  They need to utilize the land they have in a more efficient manner.

Single family residential living will not go away. The demand for quality housing options will grow along with the economic growth. Adding ADUs onto existing property creates more quality housing options without land expansion.  It also maintains a single family residential feel in these communities.  If the outlook for the economic growth in your area looks to be good over the next 10 – 30 years, then your ADU and primary residence will grow in value. This, along with having a high demand for rental property, makes the income stream from your ADU very lucrative.

How can I start working towards owning an ADU?

It is a simple as making the decision you are implementing this as a strategy for your success.  Once you do this, you begin the journey. The first step is deciding where can I put an ADU? What size should I build? Who can build and or design one for my needs? How will I finance this?

First determine your why!  Why do you want to implement an ADU?  Then you will be motivated to discover and overcome all the elements that are needed to make it happen. Talk to others that have done this.  Research on the internet. Talk to Certified ADU Specialists like myself who have been down the path and have great insights to assist you in the process.