Frequently Asked Questions

How much income can an ADU generate?

Use our ROI Calculator and see the income potential for your ADU.

Does my city allow ADU’s?

Approximately 65% of the cities along the Wasatch Front have adopted an ADU ordinance. Click here to see a document that lists the current ADU ordinances for most cities along the Wasatch Front . You can learn more about individual ADU ordinances by contacting the city offices and ask for the building department. They will let you know if the city has an ADU ordinance and can provide you the ordinance guidelines that must be followed.

The following is a partial list of the cities that have an ADU ordinance:

Alpine, Bountiful, Layton, Kaysville, Ogden, South Ogden, West Bountiful, Salt Lake City, Sandy City, Mill Creek…..

What is the process to build an ADU?

1) Verify that the city you live in has adopted an ADU ordinance.

2) Obtain a copy of the ordinance to see what the criteria the city has established for a single-family residence. The zoned home and lot must qualify for approval to put an ADU on the property.

3) Determine the size (foot print) and placement of the ADU that will meet the requirements established by the city.

4) Design your building/floor plan having a completed construction drawing package that is certified by an engineer created.

5) Using the construction design package apply for city approval and a building permit for your
ADU. Build the unit yourself or hire a company to construct the ADU for you.

To simplify and make this process move quickly contact us and we will walk through the process with you on one of our five ADU models.

What is the cost of an ADU?

The cost of an ADU can vary based upon the design, size and level of finish. We have five models of ADU’s that range from $99,000 to $136,000. For more detailed information click HERE to view our pre-designed  models. In general the cost of construction is approximately $190-$210/sqft for a standard building design and finish. Since most ADU range from 400 to 800 sqft this results in an estimated cost range of $75,000 to $170,000. This is the cost of the building only! You should also consider the additional expenses of an architect or home designer to design and prepare the construction drawing package that will be required by the city for a building permit and by your contractor to actually build the building This could be an additional $2,500 – $4,500 cost.

What financing options are available for building an ADU?

An ADU can range from $60,000 to over $100,000 to build. Typical methods for financing this are 1) Standard mortgage financing by either refinancing or taking out a second mortgage on your existing home to take advantage of the equity you may have in your home. 2) Borrowing against your 401K retirement plan. In some cases, ADU’s are built for parents. I this case often the parents have provided the funding for the ADU since they will be living there.

Your local bank is a great resource and place to get a quote on a loan. You may also check with your existing mortgage holder to see what options they have available for refinancing your existing home mortgage. Know that you are adding value to your existing property with the construction of an ADU. When talking with your mortgage lender you need to let them know that you are increasing the value of the property with this additional living space. You should ask the mortgage lender to qualify your loan by including the appraised value of the planned ADU along with the value of your home. For planning purposes, the appraised value an ADU addition to your property will be approximately 65% – 75% of the cost of construction. So if your ADU cost to build is $100,000 then the appraised value could be $65.000 – $75,000 added to the value of your home/property.

I have never been a landlord how do rent out my new income property?

This is a great question! Your financial success is directly dependent upon your ability to find and keep high quality tenants in your ADU. A high quality tenant is one who consistently and timely pays their rent and treats your property with care and respect leaving little or no damage for you to take care of.

Your primary goal must be to have this unit occupied by a high quality tenant at least 90% of the time. This means that you want a tenant in 47 of the 52 weeks of the year. You will need to market your property and have the ability to vet the prospective tenants to qualify
them as a tenant you are willing to rent to. You will also need to have a great legal lease agreement that protects you and establishes the “rules of the game” for all parties to follow. A bad tenant that does not pay rent and causes damage will cost you money.

Most landlords get into challenges through poor management of the tenant and enforcement of the lease agreement. It is for this reason I strongly recommend that a property management company be used to assist you with proper marketing, vetting, and management of the ADU property. While this is an expense it in reality will save you lots of $$$ and emotional trauma that is well worth the expense. I feel so strongly about this that I include the first year of property management with the purchase of the ADU. This provides you an opportunity to ease into the role of owning a rental property knowing you have experienced professional property management to guide you through the service. For more detailed information on the property management service provided click here.

How long does it take to build and ADU on my property?

The simple answer is approximately 60-80 days from the purchase of one of our 5 model ADUs. It can take 2-8 weeks to get the approval and building permit from the city. Once the building permit is issued and the construction scheduled it will take 7-9 weeks to complete the build of the ADU.

There are seven phases to the process of building an ADU on your property.

  • Phase 1 The preliminary site survey, planning and placement qualification. (5-10 days)
  • Phase 2 Application to the city for approval and building permit. (2-6 weeks)
  • Phase 3 Pre-construction site prep. (5 days)
  • Phase 4 Foundation, floor and underground utility connection. (5 days)
  • Phase 5 Framing and 4-way inspection. (7-10days)
  • Phase 6 Sheet rock, siding, shingle and finish work. (2-3 weeks)
  • Phase 7 clean up and final inspection (5 days)

For more detailed information on what is accomplished in each phase click (HERE) (the information below is the more detailed information on the build process)

Phase 1 The preliminary site survey, planning and placement qualification. A member of our team will meet with you on your property to verify that the ADU model you are planning on and your planned placement will fit on your lot and meet the buildable criteria check list which includes meeting City’s ADU ordinance guidelines for placement, and parking requirements. There will also be the review of how utilities will be connected from the ADU to your home. This is typically about a 5-7 day time frame

Phase 2 Application to the city for approval and building permit. A complete set of construction and engineering prints will need to be submitted to the building department for your intended ADU. The city will move this through its approval process. This can take from 2-8 weeks.

Phase 3 Pre-construction site prep. Blue stakes utility marking services are scheduled and your property is marked for all utilities. You as a home owner will need to mark and any items you may have underground like sprinkler lines. Our team will meet you on-site and stake our the placement of the ADU on the property as to the plans approved by the city. Our team will also mark the areas where excavation and trenching will be required for the connection of the utility lines. This is will be reviewed and signed off by the owner prior to any on-site construction.

Phase 4 Foundation, floor and underground utility connection. A construction crew will install the helical pier foundation system, trench and install all underground utility connections and close up the trenches. The ADU floor, along with the below floor plumbing and insulation will be installed.

Phase 5 Framing and 4-way inspection. Materials and construction crew will arrive to frame the house, install the exterior windows, doors and dry in the roof. The rough-in electrical, plumbing, HVAC, will be completed and the City will be scheduled for their 4-way inspection of the property prior to sheet rock, siding and finish work.

Phase 6 Sheet rock, siding, shingle and finish work. The interior of the house will be sheet rocked, mudded tapped and textured. Finish trim and molding installed prior to the interior of the house being painted. Once painted the cabinets, flooring, plumbing, electrical, lighting and HVAC systems will be installed. The exterior will have the final roofing, siding along with all exterior trim work completed

Phase 7 clean up and final inspection site will be cleaned up and a walk through inspection will be completed with the client identifying the final punch list of items to complete. Punch list will be resolved and the ADU will be complete.

How much construction mess will there be?

Construction by nature creates some mess and clutter. We have taken great care in our design and implementation process to minimize this mess. There will be a requirement of a space to deliver and stage the building materials for the construction of the ADU.

This typically is an area on your driveway that is 8 x 20 foot (about the size of a parked midsize car). This will require clear access for delivery truck to “drop the load” off the rear of the delivery truck bed. A small onsite dump trailer will also need to be intermittently staged to collect the construction trash and haul it off keeping the collection of construction trash on-site to a minimum.

The Phase 4 Foundation, floor and underground utility connection has taken advantage of helical pier technology to minimize the excavation and need for heavy equipment to have access to the rear of your property. A small mini excavator is used to place foundation piers in to the ground. A helical pier is much like a very large screw that is turned into the ground and is designed to hold the weight of the house.

Submit a Question

Questions…bring’m on!

That’s why we are here, to help you with building and using an ADU to assist you and your families requirements.

We look forward to connecting and resolving the question you have about your ADU plans!

Submit a Question

Address
845 N. 400 E., Suite 100
Bountiful, Utah 84010

Contact
hello@iliveinabank.com
877-ADU-UTAH (877-238-8824)

Opening Hours:
Mon-Fri: 8:00-5:00
Sat: 8:00-12:00
Sun: closed