Otherwise known as “mother-in-law suites” or “backyard cottages,” accessory dwelling units, ADUs, are rising in popularity throughout Palo Alto.
There are several reasons, from the affordability of heating and cooling a smaller residence to a focus on sustainability and minimalism or needless luxury, but what does this mean for you as a homeowner considering investing in a backyard ADU project?
ADU regulations and laws are constantly evolving, and understanding the parameters under which you can complete your new ADU project can be downright confusing.
This is where the team from Clever Design & Remodeling can help.
We are the best custom ADU builders in the Bay Area.
We can help you navigate the process of your residential ADU construction project, from the initial blueprints to securing permits and completing the finishing touches.
What Exactly Is an Accessory Dwelling Unit?
Accessory dwelling units have been popular throughout several California communities since the mid-1980s because they provide affordable housing and are the perfect way for residential property owners to increase the value of their homes.
So, what exactly is an ADU?
Technically, ADUs are stand-alone structures attached to an existing primary residence built on an existing residential lot.
Although ADUs can be considered “tiny homes,” not all tiny homes can be classified as ADUs.
One big difference is that while most tiny homes are no larger than 400 square feet, an ADU can be a maximum of 1200 square feet, according to California law.
(Don’t worry, the loopholes and size limits of residential ADUs in the Palo Alto, CA, area will be discussed in detail later!)
Accessory Dwelling Units: What Are My Options?
An ADU contractor must work within the confines of California law, and laws dictate you can only build one of four types of ADUs: attached, detached, junior ADU, or an ADU conversion, on an existing residential lot with a single-family home or multi-family residence.
Attached ADU
As the name suggests, an attached ADU shares an exterior wall with the primary structure.
The attached unit will have a separate entrance and its own kitchen, bathroom, and living area.
Regardless of the type of ADU you are constructing, the structure must be, at a minimum, 150 square feet.
For attached structures in particular, the new construction cannot be more than 1,200 square feet, or half the square footage of the main residence, whichever is smaller.
Costs and Advantages
Because you are piggybacking off the main structure, attached units are typically more inexpensive than detached units.
The typical ADU costs around $145,000 to construct, and if you are opting for an attached ADU, there are several advantages, including:
- Shared electrical, HVAC, and plumbing: Instead of spending additional resources on utilities, you can allocate those funds to home remodeling and architectural design, ultimately increasing the ADU’s ROI.
- The perfect structure for smaller lots: Don’t have room on your small lot to accommodate a detached ADU – The proposed residence will not take up as much precious backyard, creating fewer zoning hiccups.
- Dwellings that are easy to access and monitor: Secondary units are often constructed for rental income or to house an aging parent or college-aged child. You can keep a more watchful eye over your investment and prevent mischief when you share a wall with the unit.
Detached Accessory Dwelling Unit
A detached unit does not share any walls with the primary house; instead, it is its own autonomous dwelling.
A detached unit can be up to 1,200 square feet in size.
Like an attached unit, there are several advantages to working with a local contractor to construct a beautiful detached ADU, including:
- Greater privacy for your family or renters: Don’t want to share a wall with your renters or aging parents – A detached ADU can provide everyone with a little more privacy and space.
- More architectural design options: A detached ADU allows you to create a quaint cottage or modern tiny home without compromising the architectural integrity of your main house.
- The most significant ROI: Because of the increased square footage and desirability, such dwellings have the highest return on investment of all ADUs.
Do You Have Room on Your Property for a Detached ADU Project?
A detached ADU must legally be at least 10 feet from the primary residence and at least 5 feet from the property lines and nearby residents.
Before choosing a detached unit, ask yourself this critical question:
Do you have enough room on the same lot to accommodate both your main house and the ADU?
Homeowners often underestimate the size of their city lot.
Live in a densely populated urban area, such as Santa Clara or East Palo Alto, where lot sizes are notoriously small?
You may not have enough room to construct a detached unit legally and comfortably.
This is where the pro accessory dwelling unit builders at Clever Design & Remodeling become invaluable.
We will survey your existing lot, create a 3D rendering of the ADU, and help you determine if your lot can comfortably and legally accommodate the dwelling.
Junior Accessory Dwelling Units
Otherwise known as a conversion ADU, junior accessory dwelling units allow homeowners to convert an existing room in their home, including the garage and additional bedroom, into a fully functioning unit that is legally a separate dwelling.
The maximum square footage for a JADU is 500 square feet, and the unit must legally have a separate entrance and kitchen/kitchenette.
The JADU and primary structure can share a bathroom, or the owners may opt to construct a separate bathroom for maximum privacy.
Consider These Differences and Benefits of a Junior ADU
In addition to the potential cost-saving benefits, there are several other pros to working with an accessory dwelling unit contractor to construct a JADU.
For instance, the timeline is much shorter because your contractors are focused on converting an interior space rather than constructing an exterior.
Be aware that you will be sharing an address with the occupant of your ADU; there are no parking requirements, and you must file a deed restriction.
This restriction states that the homeowner must be the legal resident of the property and reside inside the house.
What Are the Benefits of Investing in An ADU Project in the Bay Area?
A Great Way to Generate Rental Income
“For rent” signs are popping up around the Bay Area, and if you are looking for a passive income opportunity, an ADU is an excellent investment.
Laws are constantly changing, so don’t hesitate to ask your Palo Alto ADU contractor about the specific requirements and regulations before determining if constructing a dwelling for the express purpose of renting it is the best financial decision.
For example, recent law changes allow some California counties to rent their ADUs short-term, such as vacation rentals, for less than 30 days.
Other counties have stricter laws, and an ADU can only be classified as a traditional rental, meaning you cannot put your ADU on Vrbo or Airbnb.
ADU contractors can help you determine which type of ADU will have the greatest rental return on investment.
Be a Part of the Solution to the California Housing Crisis: Provide Additional Affordable Housing Opportunities
It’s no secret that California and the rest of the United States are in the midst of a severe affordable housing crisis.
Thousands of residents living in the Bay Area are looking for an affordable place to call home, and by constructing an ADU and utilizing it as a rental property, you will be contributing to the city’s housing stock!
Imagine the families you could help in your city by offering an affordable rental option!
Increase the Value of Your Property
Unlike other construction projects, from a small kitchen remodel to a major bathroom addition, constructing an ADU is a serious undertaking that can take several months to complete.
However, the reward for all the hard work, manpower, and disruptions to your “normal” life is a very high return on investment and a significant bump to your home’s value.
Want to learn more about the potential ROI of an ADU?
Contact the best ADU builders near me at Clever Design & Remodeling.
Garage Conversions and the Benefits of “House Hacking”
Many build an ADU as a guest house or in-law units, but after reading about “house hacking,” the sole purpose of your ADU, in particular a junior ADU or conversion, is to ease the financial burden of your monthly mortgage.
House hackers live in their JADU or conversion while renting out the primary residence, allowing them to pay off the mortgage much faster!
This allows you to skirt the deed restriction because, technically, you are still a resident of the primary house.
Talk to the Pros at Clever Design & Remodeling to Start Your Palo Alto ADU Project!
Clever Design and remodeling professionals have been helping Bay Area homeowners design and construct ADUs for several years, and you can benefit from our expertise, too!
From the initial planning and budget to a completed, high-quality structure, we are the best ADU builders in the state!
When you work with the talented team at Clever Design, you hire a professional project planner, decor builders, and maestros to navigate the ever-changing ADU laws and restrictions.
We will help you secure any permits required prior to the start of construction, be there to answer any and all questions and help you design an ADU that will ensure you receive the most significant return on investment possible.
As an established Bay Area design company, you can rely on our expertise and business acumen, and rest assured that we are here to serve all our customers’ needs!
Our Customers Also Ask
How much does it cost to build an ADU in the Bay Area?
Your ADU builder can help you better understand the overall costs associated with constructing an ADU on your property.
Several factors to consider, including:
- The type of ADU
- Cost of permits
- Cost of materials
- Labor
- Adding utilities
Once again, a detached ADU is typically more expensive because it is an entirely separate structure and requires new HVAC, plumbing, and electrical services.
How can I secure financing for an ADU in California?
Much like financing the construction of other structures on your property or funding a remodeling project, many homeowners choose to finance their ADU by securing a home equity line of credit or a home equity loan.
The state of California may also assistance in the form of a grant through the California Housing Financing Agency, CalHFA.
Can you build an ADU without a permit in California?
The permitting process can be long and exhausting but completely necessary.
Your licensed builders can help you obtain the necessary permits and help you understand the costs associated with each, the timeline, and what work can and cannot be performed until the proper permitting is acquired.
What permits do I need to build an ADU in Palo Alto?
Each city and county has its own specific ADU permitting requirements, and at a minimum, you will need to acquire the following permits in Palo Alto:
- Building permits: This permit essentially gives you permission to build the ADU and is the most basic and arguably most crucial permission you must obtain. You must submit architectural plans and engineering surveys with this application.
- Electrical, HVAC, and plumbing permits: Most utility permits must be obtained by a business that holds a valid California State Contractor’s License.
- An address assignment request: If your detached ADU will have a different address, you will need to submit an address assignment request form to the city of Palo Alto, CA.
- Location permits: Other specific permits are required, depending on location, such as if you are constructing the ADU near a utility easement.
What is the ideal location for a detached ADU?
In addition to adhering to local zoning laws, other considerations exist when choosing a site for your detached ADU.
For example, if you are constructing the ADU for a rental property, consider constructing the structure several feet away from the main house to provide your tenants with privacy.
Detached ADUs must legally have a parking spot, so choose a location that allows convenient access to this spot.
