Financing Your Accessory Dwelling Unit (ADU): Practical Tips to Manage Costs
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Adding an Accessory Dwelling Unit (ADU) to your property is a smart way to increase living space, boost property value, and even generate rental income. Whether you're looking to house family members or make some extra cash, here’s a breakdown of how to finance and manage ADU costs. What’s an ADU? An ADU is a secondary living space on your property, sometimes referred to as a "granny flat," "in-law suite," or "tiny house." These can be standalone buildings, attached additions, or conversions of existing spaces like basements or garages. The key is that they include a bathroom and kitchen, making them fully independent living quarters. Why Add an ADU? There are plenty of benefits to adding an ADU. Beyond increasing your property value, they can be rented out for extra income, or used to house aging parents or adult children. In high-demand housing markets, ADUs can significantly increase your home’s appreciation rate. Types of ADUs Freestanding ADUs : S