by Cora Gold October 28, 2021 2 min read

Accessory dwelling units (ADUs) have seen a burst in popularity over the last few years. This trend is likely due to the staggering rise in U.S. housing prices and numerous states lessening building restrictions for the construction of ADUs.

Just what is an ADU? These units are usually less than 1,000 square feet and are entirely separate and functional living spaces. Sometimes the ADU is inside a house, such as a renovated attic or basement. It can also be attached to a home as a room addition or refurbished garage. Another option is a standalone unit on the property, like a garage or carriage house.

People all over the U.S. are currently scrambling to build ADUs for a variety of reasons.

1.  Affordable Housing

The cost of purchasing and owning a home continues to rise, making the dream of homeownership impossible for some. Millennials seem to be the hardest hit by this current trend. ADUs provide a much more affordable option when it comes to homeownership.

Many states are offering assistance in building ADUs and are boosting them as affordable housing options. If you are looking for an economical choice in homeownership, consider your own ADU. Constructing one is far cheaper than an entire house because it requires fewer resources to build.

2.  Eco-Friendly Considerations

People who care about the environment often opt to build ADU’s. The units require significantly fewer materials and resources to construct than traditional homes. They also use fewer resources like electricity and water, which means less drain on our planet’s natural resources and fewer carbon emissions.

3.  Improved Property Value

ADUs are a popular build because they increase a homeowner's property value. While you can't count on one to add value by a set amount, you can estimate it will grow by approximately $21,000-$29,000 as long as you've received all state and local permits while building. You'll also need to ensure your ADU space is correctly outfitted for renters and meets all state standards.

4.  Family Living Options

Several people choose to build ADUs because it's a great way to keep families together — providing multigenerational living options without the entire family living in one residence. Currently, 66.7 million Americans, or one in four over 18, live in multigenerational households, mainly due to the current economic trends.

ADUs provide flexibility to families in different situations — aging grandparents can maintain independence in the ADU while the rest of the family checks in periodically. Even adult-age children can keep their space in the ADU, while parents can have the rest of the house to themselves.

5.  Passive Income in the Sharing Economy

Some homeowners might choose to rent their ADU and generate revenue for household expenses. This is a significant perk of building and owning an ADU. You might consider a longer-term rental strategy with tenants in a year-long contract, or you could try using your ADU as a site to host travelers with VRBO or Airbnb.

The Perks of Building an Accessory Dwelling Unit

ADUs are currently a popular choice in real estate, whether you’re considering one because you need an affordable housing option or want to protect the environment. Think outside the box and consider building one to reap the benefits.