What Is an Accessory Dwelling Unit (ADU), and Is It Worth the Investment?

June 8, 2021

What is an Accessory Dwelling Unit (ADU), and is it worth the investment?

An Accessory Dwelling Unit (ADU) is a secondary suite built on the same lot as the primary home that gives owners a chance to generate rental income and boost property value.

As many parts of North America suffer from a housing crunch, some jurisdictions have embraced ADUs as a way of building affordable homes without upsetting the affluent Not In My Backyard (NIMBY) voters with pivotal zoning changes.

In places like California, where the housing crisis has made a quarter of the population homeless, relaxed new ADU rules have led to a boom in secondary suite construction.

Since 2017, when ADU laws began to soften, California’s seen a 1,100% increase in ADU permit applications! It’s no wonder — even the smallest ADUs in up-and-coming areas command rent prices upwards of $2,000/month and add substantial resale value to the property.

Thanks to the unprecedented new regulations, California homeowners can now build:

A Detached ADU up to 1,500 ft2 — these homes are entirely separate from the primary dwelling and can be either built from the ground up or converted from a garage or another accessory structure.
An Attached ADU up to 1,200 ft2 — these are separate units within the main dwelling, usually converted garages.
A Junior ADU (JADU) up to 500 ft2 — comprises a master bedroom, kitchenette, and a separate entrance within the main dwelling.
A detached or attached ADU AND a JADU.

Detached ADUs can be constructed with various methods and materials, like light-wood frame, light-gauge steel, or ICF systems.

Element ICF is a stellar ADU material, as its high insulative properties, strength, and resilience make it easy to comply with California’s stringent energy, seismic, and Wildland-Urban Interface requirements.

Element ICF has an entire selection of small home plans that meet ADU construction standards in California and elsewhere in Canada and the US — you can check them out here!

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What Is an Accessory Dwelling Unit (ADU), and Is It Worth the Investment?