Building an ADU: A Comprehensive Guide

What are Accessory Dwelling Units?

An ADU, or Accessory Dwelling Unit. Think of it as a tiny home: compact, fully functional, and independent residential unit that cozies up on the same piece of land as your primary dwelling. In simpler terms, it’s a secondary living space on your property that can serve as a guest house, rental unit, or even a home for a family member.

And with the rising housing costs and the need for affordable housing options, accessory dwelling units have become increasingly popular in recent years. Whether it’s an attached addition to your existing house, a freestanding structure out in your backyard, or a spruced-up basement conversion.

an ADU is all about maximizing your living space, and if you play your cards right, your income too. It’s like having a guest house, but with an upgraded title and much cooler benefits for property owners. So, let’s roll up our sleeves and dive into the thrilling world of ADU construction!

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Who needs an accessory dwelling unit?

ADUs are pretty versatile. What’s not to love about a stylish, compact living space that can adapt to a variety of situations? Here are a few scenarios in which an accessory dwelling unit might just be the perfect fit:

Empty Nesters:

Maybe your chicks have flown the coop, and you’ve got more space than you know what to do with. An ADU can turn that empty nest into a bustling hub of activity (and a source of income, if you fancy playing landlord).


Aging in place? An ADU, with its single-level and accessible design, can be an ideal choice. Plus, it’s a great way to stay close to loved ones.

Home Office Buffs:

Hello, remote workers! An ADU can be your ultimate work-from-home haven, keeping work life and home life blissfully separate.

Multigenerational Families:

Got a child back at home or an elderly parent? An ADU offers the perfect balance of proximity and privacy.

Rental Income Seekers:

Who wouldn’t like a little extra dough each month? With an ADU, your backyard becomes an income-generating asset.

So, whether you’re an empty nester, retiree, work-from-home devotee, multigenerational family, or just someone keen on financial savvy, an ADU might just be your ticket to residential bliss. Now, let’s get building!

The Benefits of Building an ADU

  • Extra Income on your property: Rent it out and make your property work for you. It’s a steady flow of cash that can offset your mortgage payments or fund that vacation you’ve been dreaming of.
  • Welcome to the Family, Granny: Keep your loved ones close, but not too close. An ADU provides the perfect living space for an aging family member, allowing you to provide support whilst maintaining a sense of independence.
  • Test Drive a Tiny House: Ever wondered what it’s like to live in a tiny house? Building an ADU lets you dip your toes in the water without the full commitment.
  • Slash Your Commute: Turn your ADU into a home office and say goodbye to traffic jams and crowded trains. Your commute could be as short as a walk through the garden!
  • Join the Green Revolution: Using minimal resources and promoting sustainable living, ADUs are a small but mighty weapon in the fight against climate change.
  • Boost Your Property Value: Not only functional, ADUs can also significantly increase the market value of your property. It’s an investment that could prove lucrative when it’s time to sell.

Financing accessory dwelling units

Here comes the million-dollar question (sometimes quite literally) – How do you fund your ADU project? Well, fear not, would-be ADU tycoons! There are quite a few avenues to explore when it comes to financing your dream ADU. Let’s break it down:

  1. Home Equity Loans: Got some equity in your home? This could be your golden ticket to ADU-ville. Home equity loans let you borrow against the value of your home, providing a lump sum of cash for your construction project.
  2. Construction Loans: These are short-term loans that cover the cost of construction. Once the ADU is built, you can refinance into a regular mortgage. Think of it as a construction-to-permanent loan. Well, hello, financial flexibility!
  3. Personal Savings: If you’ve got a substantial nest egg, this might be the time to crack it open. Just be sure you’re not sacrificing your future financial stability for your present construction frenzy.
  4. Government Programs: Believe it or not, many local jurisdictions promote adus. Check out local and federal programs geared towards grants for adu financing.
  5. Friends & Family: Got some generous kin? They might be willing to invest in your ADU project. Just remember – mixing money and family can be a tricky business. Make sure everyone’s on the same page.

Getting Started

Alright, ready to rock ‘n roll? The first step towards building an ADU is not picking up a hammer, but a pen (or a keyboard, let’s be real). Planning is the name of the game here. You need to understand the local regulations and permits needed for constructing an ADU in your area.

Rules can vary widely from one local jurisdiction to another, so doing your homework is crucial. Wondering about the size of the ADU, the height, the setback from property lines, parking and owner-occupancy requirements? All of these rely on your local ADU ordinance.

It may seem like a daunting aspect, but with the correct information and thorough planning, the process promises to be rewarding . It’s always advisable to consult with an architect or engineer early on in the process to ensure steps are taken in the correct order.

Attached ADU or Detached ADU?

It’s time for the million-dollar question – to attach or not to attach? This is the Hamlet-esque conundrum you’ll face when diving into the accessory dwelling unit building process.

Attached ADUs are joined at the hip with your primary dwelling. You might convert secondary units into a part of your existing house – ‘Hello, basement! Meet your glamorous future.’ Or perhaps you’ll add on a completely new structure. Either way, it’s about maximizing the potential of your current living space.

Detached ADUs are standalone buildings that hang out in your backyard. They’re like a private retreat right on your doorstep. Got a garage that’s serving as a glorified storage unit? Time for a makeover! Or maybe you’ll build an entirely new structure from the ground up. With a DADU, the sky’s the limit (or at least as high as local regulations allow).

Whether you decide to go attached or detached, remember that each option has its unique benefits and potential challenges. It all boils down to what works best for your property, budget, and lifestyle. So go ahead and start visualizing – your dream ADU is just a few decisions away!

Step 1: Feasibility – Get Your Ducks in a Row

Before delving into envisioning our ideal ADU, it is imperative to assess the project’s feasibility. This entails conducting a thorough investigation to gather essential information. Understanding your property’s distinctive attributes and limitations is crucial in this initial phase.

Consider whether your current residential zoning permits an attached ADU, and assess whether your lot size allows for a detached ADU within local setback requirements. Moreover, determine the accessibility of utilities.Having an Architect on board early on in the process will make this a linear process, also involving the required engineers inputs at the right time. 

Step 2: Initial Planning

Building an Accessory Dwelling Unit (ADU) requires meticulous planning. The first step involves understanding the local regulations and ordinances concerning ADUs in your area. These regulations tend to differ, not only from city to city, but also local jurisdictions and from one Erf to the next. 

It’s crucial to familiarize yourself with these rules to avoid legal disputes or building hiccups down the line. It can be a tricky maze to navigate, but a necessary one. Having an architect on board will speed up this process and ensure all aspects of the project are covered.

Start by visualizing the ADU you want to build. Whether it’s a detached, a carriage house or some granny flats that need an upgrade, having a clear vision for your ADU will simplify the subsequent steps. Consider the size, design, placement, and utility of your future ADU.

Remember, your ADU should not only be an extension of the main house on your property but a complement to it. This strategic planning stage is your foundation for a successful build, ensuring the new building blends perfectly with the primary dwelling, enhancing your property rather than detracting from it.

Step 3: Secure the Permits

All ADU’s require building permits from the local municipality or building control office. Your appointed local A&E expert will have full knowledge of the applicable legislation for your region. Below is an example of the legislation applicable in California for building and ADU.

Assembly Bill 68 (CA)

Allows homeowners to add two units – an ADU and a Junior Accessory Dwelling Unit (JADU) – on any residential lot. This means you can legally create a triplex on every single lot (if your lot meets size and setback requirements) according to the 2024 ADU laws in California.

Additional units can be added to existing multi-family buildings like apartment complexes. Building owners can convert any non-habitable rooms, like attics, basements, garages, etc. into legal additional units.

Single Family Homes:

  • One ADU (up to 1,200 sq. ft.) and one Junior ADU (a unit of not more than 500 sq. ft. and contained entirely within an existing single-family structure) per lot.
  • One detached ADU (up to 1,200 sq. ft.) that is new construction, existing structure, or the same footprint as the existing structure, along with one JADU.

Multifamily Dwellings

  • Multiple ADUs within existing multifamily structures.
  • Two accessory dwelling units on a multi-family lot.

Most homeowners with residential properties may be thinking, “It’s my property, why do I need a building permit? The answer is simple, to ensure you and your potential tenants are safe and feasible. You might need additional permits for plumbing, electrical, or mechanical work too so working with a professional will save you form a nasty law suite down the line.

Step 4: Build an ADU!

Alright, now you are making real progress. It’s time to build an ADU. Your ADU construction journey starts with laying the foundation. Be it basement conversions, garage conversions, backyard cottages or granny flats, it is important to get an expert in to ensure your foundation is stable and can handle any additional loads.

Residential construction can be exciting DIY renovation projects or a complex new construction of several units. Either way it is important to ensure complete safety throughout the process. homeowners building ADUs will be liable for any impact this process has on the immediate environment, surrounding structures and the public at large. to avoid lawsuits, it’s best to have someone with the right qualifications on board to manage the intricacies of the job.

Remember to consider your plumbing and electrical needs as well as water supply. These have impacts on the surrounding community and should be integrated into the existing infrastructure.

Step 5: Inspection – The Final Frontier

It’s time to bring in the men and women in hardhats. No, not more construction workers – we’re talking about inspectors! Now that your very own ADU is standing tall and looking good, it’s time to cross the t’s and dot the i’s – inspection time!

Having your ADU inspected is like a final exam – it’s the last step to make sure all your hard work checks out. The primary focus will be on safety and adherence to all local building codes. This step involves both exterior and interior inspections of the completed ADU. Local building officials will diligently check systems like plumbing, electrical, and HVAC to ensure they meet local codes and regulations.

So, get ready for inspectors to thoroughly scrutinize everything from grounding systems to fire safety measures. They might seem a bit nitpicky during the process, but they’re just ensuring that your ADU is ready for occupancy, safe, and up to code. Once you’ve passed the inspection, you’ll receive a certificate of occupancy – this is the final stamp of approval for your ADU.

It’s like a graduation day – from blueprint to reality, your ADU has officially made it! Now, it’s time to move in, rent out, or however you plan to use your new space. So, buckle up, ADU-venturers, it’s inspection time! #ADU #occupancy #safetyinspection

Step 6: Reaping the Benefits

It’s time to reap the incredible benefits of your shiny new ADU. You built an ADU, and you now have access to the list of benefits this brings to you as a homeowner!

Whether you’ve added living space for family, a haven for visitors, or a potential income generator, your ADUs have just increased the value of your single family home.

If you’re considering renting it out, get ready to welcome a steady stream of income that can significantly offset your housing costs. Say hello to affordable housing! Not to mention, you’ve just contributed to the local housing market by creating additional rental housing, and, in today’s world, every bit counts towards housing innovation.

Remember, at the end of the day, your ADU is more than just a secondary dwelling unit. It’s a testament to your hard work, meticulous planning, and dedication! You’ve earned it #ADU #benefits #celebratesuccess

Picture of Scott Zurn, P.E.

Scott Zurn, P.E.

Founder and CEO of Level Engineering & Level Design Partners. With more than 4 decades of experience, Scott Zurn has contributed to all aspects of the building industry, serving both public and private sectors. He’s achieved tremendous success in commercial and residential markets, held leadership roles such as building official, city engineer, and director for local governments, and accomplished hundreds of millions of dollars in successful commercial building and civil infrastructure as a designer, project manager, and leader. As the Founder of the Level brand, Scott is dedicated to ensuring the entrepreneurial success of design professionals, as well as creating positive environmental impacts through design work. Read Scott’s full bio here.

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