Potential Garage ADU

[Arron Paulino]

I recently acquired my first primary residence and am seeing ways I can best utilize the space for real estate investing. The property is a 3 bedroom, 2 bath (one of the rooms is the master with its bathroom and access to go outside), with a separate garage and an unfinished garage unit. I am wondering if I should just use the garage as your typical garage as it just has my washer and dryer and space for my car, but I usually just park on the driveway/street. Would it make sense to form this into an ADU or leave it as is? I do have a monthly mortgage on my property and have this as a starter home. I live near a local college and this is in the East Bay Area, CA. I think the long-term plan for this home is either to sell it later on or keep it as a rental as this isn't our forever home. Looking forward to hearing from investors who have experience with this opportunity.

[Henry T.]

If I was just starting and young. I would fix up the garage and live in it myself (DADU) and rent out the house. If youre near a college, rent out the rooms and charge a premium. I would think transient room mates on renewable short leases would be much safer than bearing the brunt of San Francisco's LTR tenant laws. Learn the landlord laws intimately before jumping in, and find a landlord mentor with experience. Join a local landlord association too.