ADU's in New Jersey | When are they Legal?

[Mario Arnone]

Hi All:

I think the ability to have an ADU on your rental property could be a great way to find positive cashflow on a rental that would be negative otherwise. I am a displaced restaurant owner without income. I'm currently living at my mothers and have rented my home for $600 a month in cashflow. I'm looking to purchase a single family home with a large two car garage to be used as an ADU. I would rent the main portion of the home and build out the garage as an ADU and live there myself rent free.

However, after reading the housing code in my neighborhood and adjacent counties, it's not totally legal. However if I was to live in the property and was "on-site" and created an arms length lease for the main home maybe it works? My thought was if the neighbors disapprove and file a complaint, and I was forced to leave, I could move back in with mom and legally rent the home. The ADU or additional space would then make the home a larger space and I could increase the rent with the next tenant. Not exactly the best but an exit strategy none the less.

Any thoughts or comments on this matter? Does anyone know states that allow legal ADU's. Thanks in advance for your help!