ADU tips appreciated

[Javier G.]

Hi everyone, I am brand new to BP website. I have read multiple books from BP and listen to their pockets regularly. So I like in Southern California and as many of you might know the market here is pretty insane in regards to high prices. I am a current homeowner and I recently started to conduct some research into building an ADU at my current residence. I have an attached 400sq ft garage that I would be converting. Any tips, suggestions, or guidance from people who are familiar with ADU's would be very helpful.

[Brian Larson]

I will echo @Dan H.here. I recently built a detached 1 bedroom ADU above a 2 car garage in San Jose. It had a horrible return. For the construction cost of $330K, the appraiser gave it a value of $190K. It was a total joke.

In your situation, it may be cheap to convert the space (mine was a brand-new structure).  But again, I think you would be surprised at these returns.  They are generally not very good.