What to Know about an ADU as an Income Property

What to Know about an ADU as an Income Property

An Adu as an income property: An accessory dwelling unit (ADU) can be a great way to create an additional stream of income. In addition to boosting property value, your ADU can be rented out to short term or long term tenants. You might want to do this just until you have recouped your investment, or you may discover that this passive stream of income is a great long term plan.What to Know about an ADU as an Income Property

Designing an ADU that is the right fit for your property is where we come in. To learn more about what kind of ADUs might work best in your unique scenario, contact us any time.

In the meantime, here are a few things to consider about an ADU as an income property.

What to Know about an ADU as an Income Property

Who is my target tenant?

As you decide what size and style of ADU to design, start by considering your plans for the dwelling. Who do you plan to rent this ADU out to? If you are imagining a long term tenant, you may want to focus on ADU features that are appealing to someone looking for a home, like a full kitchen, multiple bedrooms, or an outdoor patio space. If a short term vacation rental seems like a better fit for you, you may be able to invest less in the kitchen, offering a kitchenette instead, and allocate more of your budget toward decor and furnishing that will make the property stand out in online listings.

What features should I include?

After you determine what type of tenant you are planning to find, you can decide on individual features. Some things will make sense no matter who you are renting to, like choosing durable, easy to clean flooring and prioritizing working with reputable contractors (which is where we come in).

If you are planning a short term vacation rental, focus on features and amenities that will draw vacation goers, like an HDTV with a streaming service, high quality furniture, and decor that makes a statement. You won’t have to furnish the place if you are looking for a long-term tenant, so you can put more resources into other parts of the process.

How can I manage privacy and security concerns?

Many people are concerned about the privacy and security implications of placing an ADU on their property and offering it to strangers. There are a few ways to provide peace of mind in these areas:

  • Install smart home security features on your house and around your property
  • Orient the ADU so that it can be accessed privately without walking through your backyard or across your porch
  • Pay attention to window placement on the ADU to avoid staring into each other’s homes

How big can an ADU be?

We can help you determine the size limits for your unique situation, based on your property size, your city and county’s guidelines, and any restrictions from your HOA. You may be surprised to find that an ADU can be an extremely efficient use of space, with as many as 3 bedrooms and 2 bathrooms, or even 2 stories, without taking up much of your backyard.

Ready to get started on an ADU as an income property? Contact us any time to learn more.

For all renovation services in Calabasas or remodeling contractors in Thousand Oaks and surrounding towns such as Hidden HillsUniversal CityBel Air, and renovations in Canoga ParkContact SK Home Design and Remodeling. We are experts in kitchen remodels, bathroom upgrades, home additions and all contracting services in Sherman Oaks and Lake Balboa.

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