How to Analyze Garage Conversion to Studio

[Bill Haley]

Would love to hear your feedback on this: whether it is worthwhile, how to measure it, and any other sage advice:

We a 450+ sq. ft. garage in the back yard that we almost never use. You had to drive 1/4 mile down the alley to access it. I think it would make a great studio, as we live in a desirable part of Phoenix, lower Arcadia. What do you think about converting it into a studio?

I have tried to analyze the deal on the BP calculators, but it does not fit the templates, and I am not sure how to find rental comps for an add-on studio. So I have two questions, maybe three:

1) I get stuck on the purchase price portion of the deal, as there is no purchase price. I am estimating it will take $20-25K to refurbish it. We have to add a kitchenette, bathroom, A/C, sewer, bedroom, insulation, and more. How do I figure out the ARV and the Cash return?

2) Which flows into my next question: where is the best place to find rental comps for an additional room?

I really appreciate your help with this!