Buying & Selling Real Estate
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated over 4 years ago,
Build a Prefab ADU or not? Can this affect equity of the house?
I'm in the process of purchasing a SFR 3bd/3ba with a lot size over 7,500 sq. ft.
The idea is to build an 800 sq.ft. ADU/Granny unit on it. The ADU will generate a rental income of 2,000 a month.
The cost to build an ADU unit in California is about $200 per sq. ft about $160,000 cost
There is also the alternative to install a prefab unit made of storage containers and the cost for the same sq. ft. is $100,000.
Both alternatives will generate the same rental income of $2,000 a month.
If I decide to sell the house in about 5 years, having a prefab unit will not increase the value of the property as much as if I have conventional construction unit?
What are your thoughts of what type of construction to do?
Spend less on building a prefab unit or go for the conventional construction to get a better sales price when I’m ready to sell the house?
Thank you.
MB