• RTB Staff

Do Accessory Dwelling Units (ADUs) save Money?



The short answer: yes. But when it comes to the financial payoffs of investing in ADU constructions, things go a bit more in-depth. From mortgages to secondary capital, the income your ADU generates can be put towards almost anything. 


How you earn


The biggest question when it comes to rental income of ADU’s is not necessary if you can make a significant amount of money, but how much you can make. This depends largely on how you, as the homeowner, decide to monetize your ADU. But through leasing out the property, you can see a return on constructions at and under 200k in as little as 6 years, give or take. After this, income generated from the property would be almost all profit.

When it comes to ADU’s, it is entirely possible that you won’t see a return on your initial investment, and then, in turn, a profit, for several years. But like any waiting game, it can be totally worth it...

How you benefit 

Most people would pale at the thought of taking on an additional housing payment (even if only for a comparatively mini house, and a comparatively mini payment). But, for those who endeavor to lease out their ADU properties, the secondary income these units generate can actually be put towards paying off the mortgage on your primary living space. As in, once your ADU starts to turn a profit, you can basically have your second house pay for your first. But beyond renting to a tenant or short term occupants, you can also build a space for a guest house, office, or housemate dwelling to increase your property value. 


How you budget


The worst part about investments? Waiting for them to pay off. 


When it comes to ADU’s, it is entirely possible that you won’t see a return on your initial investment, and then, in turn, a profit, for several years. But like any waiting game, it can be totally worth it, especially considering all of the budgeting tricks you can utilize to cut costs while waiting for your property to make you rich. 


Talk to your designer about energy saving methods you can implement into the unit, like solar panels and thorough insulation, which can cut the costs on electricity and heating. Also, to save money, you could also consider taking your ADU construction to a one-stop manufacturer that handles the design, building and installation of the unit; the consolidated cost often makes these companies the best option for those who want to reap the benefits of a streamlined construction process. 


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A Container Box Company