My neighbor is renting her Jr.attached ADU: 2 bedroom, 1 bathroom, 825sq -furnished- $2500/mo (utilities incl./ current tenant renting for 6mo).LOFTI have plenty of land for detached ADU /their own yard, driveway & entry with the goal of a 1 bedroom/1 full bathroom downstairs & a bedroom/powder room upstairs <so 1 & 1/4 bath>...

A couple of things in regards to saving on taxes by utilizing depreciation correctly.

The key is finding a reputable house-moving company in your area that can handle permits, utility disconnections, and logistics.

All utilities are at the street. 

@Jason Porto6-12 Months of Expenses: Many investors aim to have 6–12 months of property expenses (mortgage, insurance, utilities, and maintenance) saved. 

See when materials get delivered, etc.This last one is debatable but It works for me.Not utilizing rewards or cash back credit cards during renovation projects to maximize ROI.

When there's tenants already occupying the property, there's often times different leases that were signed among the tenants.Additionally, renting by room usually sees higher tenant turnover which in turn causes more work for the PM.Other challenges to consider:- Disputes/conflicts among tenants (different personalities if a tenant doesn't know the others prior)- Occupancy limits- Splitting utilities (what if someone uses more water?)

Since you said both units are rented, I'm assuming you are utilizing the LTR strategy?

Utility Costs (Water, Gas, Electricity):- Paid monthly by the tenant unless included in rent.

It felt like a no-brainer for the value of the land, but being able to utilize a traditional mortgage because there was a clean yet simple 3 bed 2 bath house on the lot made the deal even sweeter!