ADU ROI Calculator
Calculate return on investment for Accessory Dwelling Unit (ADU) construction. Analyze payback period and value uplift.
How it works
ADU ROI considers both rental income and property value uplift. Payback = Total Investment ÷ Annual Cash Flow.
Example
$150K build cost, $2K/month rent = $24K annual income, 6.25 year payback.
FAQ
What is an ADU?
Accessory Dwelling Unit - a secondary housing unit on a single-family property. Examples include backyard cottages, garage apartments, basement units, or converted spaces.
Do ADUs add property value?
Yes, typically 20-30% of construction cost in added property value, plus ongoing rental income. Value varies by location and quality of construction.
What permits are required for ADUs?
Most jurisdictions require building permits. Many cities have streamlined ADU permitting processes. Check local zoning laws as requirements vary significantly by location.
Can I finance ADU construction?
Yes, options include cash-out refinancing, home equity loans, construction loans, or specialized ADU financing programs available in some markets.
What's a good ADU payback period?
5-10 years is generally considered good. Shorter payback periods indicate strong returns, while longer periods may not justify the investment complexity.