Should I Build An ADU?

Two questions to questions to ask yourself first.

Can I make money from it?
Will it better my life in any way?

Suppose you answer Yes to both questions. Then Keep reading to learn 5 reasons to build an ADU.

1. Increase Property Value

Many Homeowners (You Included) in California are building ADU to increase their property value. An ADU can add 10%-35% of resale value depending on the size of the ADU. Building An ADU can be costly, but once it’s complete, you’ll get a certificate of occupancy from the city. With a certificate of occupancy, you will be able to rent it to tenants legally, or you can live in the accessory dwelling unit. If you plan to sell your home, an ADU in a property could be considered in an appraisal. The appraisal would show an increase in the value of the property.

For example, let's say your property has a value of $700,000, and the following are the specs for an ADU.

ADU Size: 1200 sqft
Bedrooms: 2
Bathrooms: 1
Story: 1

The cost for one story 1200 sqft ADU, 2 bedrooms, and 1 bathroom would cost approximately $225,000. The home has a value of $700,000. Once SKY EDIFICE finishes your ADU, they will increase the property's value by 10%. SKY EDIFICE believes that they can achieve an additional 30% in property value.
You can increase property value if you have an outstanding font view, modern landscape design(linktolandscape), and a professional exterior paint job.(link to paint). These approaches alone will not give you a 30% increase in value, but with the help of SKY EDIFICE, you will.

2. Cash Flow (More Income)

Best reason why to build an ADU is because of cash flow. Cash flow is the money that a real estate property can generate. In other words, the amount of money that an ADU produces. The amount of income you gain from the ADU depends on you. There are multiple ways to find ADU market rents. But the most common to determine ADU rents is by asking neighbors, family members, or friends in the same area or city to determine what they pay for ADU or how much they receive from an ADU. No matter the amount of income you receive, it will still be more than if you didn't have an income from your ADU. If you want to rent your ADU at a competitive price, contact a real estate agent to help you determine this minor detail, or contact SKY EDIFICE to get in touch with our residential real estate agents.

3. Increase Your Investment

You are already an investor. Being a homeowner means that you have invested your time, energy, and savings into a property that gives you a better return on your investment. Since the time you first bought your home, how much equity have you gained? 10, 20%,30% or more!!!

If you have already gained equity, pause for a moment and imagine your seeking to buy a new property. How much more will you gain in purchasing a new property with an ADU? Buying a home with an ADU is having 2 properties in one lot. When you have two properties in one lot, you can make money at a much faster rate, although it can also be very risky if you have not finished paying off your mortgage.

Scenario # 1 You have the idea to buy either of the following properties:

1)one property with no ADU (this will give you equity of 10%)
2)one property with ADU (this will give you equity of 15%)

Your equity will keep increasing by 1.5 of its original value if you choose to go with the property with an ADU. For example, if your home has gained 10% with one property now, it will earn about 15% because you’ll have an ADU. Of course, these are just examples and can be lower or much higher depending on the location and size. As long as California stays within tolerable temperatures, beaches next door, the economy keeps improving, and California remains a tourist attraction, your real estate will keep increasing!

4. Sell Your Home for A Higher Price & Faster by Building An ADU

Adding an ADU to your property before selling will increase the resale value. You can also have the opportunity to achieve additional rental income before selling it, which is a much more incredible opportunity than just having one property. If you are wondering if investing in an ADU is worth it? Click on our article, (ADU A Good Investment?)

You’ll learn why it's a good investment to build an ADU.

5. Keep Family Close (Help Others)

Are the kids growing up faster than you thought? Maybe you want a playroom for the little ones, and once they stop playing, you can rent it out. Building an ADU can make that possible. Another alternative could be to help family, friends, and others during these difficult times who have lost their homes. Many people need shelter and helping each other is always a great feeling.

SKY EDIFICE Fun Fact

SKY EDIFICE SKY EDIFICE provide more than just ADU contractor services in Los Angelees. They have the ability and experience to perform work from
Painting Contractor, Landscape Contractor, Real Estate Company, Mortgage Loans.