Purchasing new property: Maximizing ADU build potential
By Scott Johnson, ADU Expert @ Napa Sonoma ADU Center & Founder, Pocket Housing LLC
With the popularity of accessory dwelling units on the rise, a lot of folks are thinking about the potential to build an ADU when looking at new property for purchase. Here, we give you some of our top tips for what to look for when purchasing a new property, with an eye towards maximizing the ADU potential.
For all ADU types:
- Eligible to build ADU and/or Junior ADU: Use our Address Lookup Tool to check that the property is eligible to build an ADU and/or Junior ADU. Most will be! Before making a final decision on a property, it doesn’t hurt to triple check with the local governing jurisdiction as well.
- The local ADU rules: Check out the Your Local ADU Rules page on our website to learn more about the jurisdiction-specific ordinances that will govern your ADU build on a given property. Some jurisdictions have local rules that are more “pro-ADU” than others; for example, some have lower fees or allow a larger maximum ADU size, etc. In addition, some regions will be tougher to build in, such as the Coastal Zone, which has more regulations that could restrict your build.
- Closing contingent on outcome of meeting with local jurisdiction: Depending on the property you find, and the deal you strike with the seller, speak with your realtor about the possibility of having the closing on the property you’re considering purchasing be contingent on having a pre-application meeting with the local jurisdiction so that you can be assured of the regulatory environment.
- Newest house possible: The newest house you can find, especially for a garage conversion, interior conversion or Junior ADU, simply because it will be better insulated and have more modern amenities (like the electrical panel) that will be more tolerant of converting spaces to an ADU or Junior ADU. This will also decrease build time, allowing you to have the ADU on the market sooner, and collecting rent (ROI!) sooner.
- Consider common cost drivers: Keep in mind cost drivers named in our Building ADUs webinar, like "one wet wall," the option to share utilities, ease of having a separate exterior entrance for the second unit, and privacy between the units;
- Not on a septic system: Ideally, a property that is not on a septic system -- if the existing septic system does not have capacity to add an ADU, doing so can be difficult and costly.
- Near transit stop or jurisdiction without parking requirements: Look for a property within a 1/2 mile of a transit stop if possible -- this prevents the need for any additional parking in most jurisdictions. (Although note that some don't require any extra parking regardless).
- Include estimated ADU budget in your financing plan for the new property: And of course, when thinking about financing for your new property purchase, consider the estimated budget for your ADU build as well. You can learn more about financing your ADU from our on-demand webinar on the subject.
For a detached or attached ADU, look for:
- Flat site: A flat site, or if there's a slope, that the ADU will end up higher than the house. But note that any extreme slope/hillside should be avoided - it makes the build harder and more costly.
- Enough space, accounting for setbacks & possible easements: Plenty of room on the parcel after setbacks are accounted for (and make sure that you really know where the true property line rests). Note, for some jurisdictions an attached ADU has to follow the setbacks of the main house, not the general rule of 4 foot side and rear setbacks established under the 2020 California state laws. Also make sure you’re aware of any property-specific easements or other characteristics such as creek or stream that might require a setback or otherwise impact placement of an ADU.
- Easy access for construction on the property: Generous side yards or access to the potential ADU site location: First for construction equipment, second to allow a tenant easy access to both come and go, and also to be able to move furniture and large items in and out without problems.
- Easy access for prefab/modular: If interested in a prefab/modular ADU, make sure there is either enough access to back a large truck through the side yard (with 14' of clearance overhead), or a lack of power lines, trees, and other overhead obstructions that would rule out using a crane to lift a unit into place.
- Solar access: Good solar access (i.e., southern-facing roof slope without a lot of trees.). Solar will likely be needed for a detached ADU, and you might as well install a system large enough to power the whole property.
- Avoid HOAs: Avoid Homeowners Associations (HOAs). While under state law an ADU can be built in developments with HOAs, some are still fighting it, and may cause headaches down the road. Note that under state law, HOAs cannot ban ADUs or JADUs, regardless of any existing rules or covenants. However, HOAs can set reasonable design guidelines for ADUs and JADUs.
- Age of existing house & electrical, etc.: For attached or detached ADUs, the age of the main house matters less, but note that if it's old you may be upgrading the electrical panel and water supply to be able to support the ADU.
- Large yard: Ideally a yard big enough or laid out in such a way that both the main house and ADU can have some semi-private yard space.
For a garage conversion ADU, look for:
- Newer structure: Newest garage possible, or a detached garage in good shape. Look for homes with newer garages that are less likely to need costly upgrades to bring them up to code for a habitable space (e.g., new foundation, etc.).
- Larger structure: A larger garage is better in general. A two-car garage is typically around 440sf, minus whatever carve out you make for a washer and dryer and utility space. Of course being under 500sf it can be converted as a JADU IF it is an attached garage, leaving the opportunity for a larger ADU in the backyard as well (under the 2020 state laws, most properties are eligible to build both 1 ADU and 1 JADU).
- Enough headspace: Good headspace (more than 8') in the garage in order to build up a floor and still have enough headroom without having to re-engineer the roof (i.e., move trusses or adjust roof framing).
For an interior conversion ADU or Junior ADU, look for:
- Enough existing space to convert: Homes that have either extra interior space you could easily convert partially into a Junior ADU or ADU
- Ability to convert first-floor space: Single story house, or a multiple story house with a room on the first floor that can be converted.
- Easy exterior access: Look for a corner room closest to a decent side yard or a room that faces the street (to provide a walkway/exterior access for the tenant).
- Option for “one wet wall” design: Maximize the possibility of “one wet wall” design. In other words, work with your designer to keep the plumbing for the kitchen and bath for both the ADU/JADU and the primary residence within one shared wall. This can simplify the plumbing dramatically, thus keeping costs down. Note that it is unlikely that you'll find a bedroom that shares a wet wall with a kitchen but you might find one that shares a wet wall with a bathroom. Pay attention to which side of the bathroom the sink/shower head and drains are on. Some bathrooms have two wet walls, but if everything lines up on one side of the bathroom that's good evidence for which side is 'wet.'
- Ensure conversion will meet minimum size requirements: Ensure the space is big enough to convert and still be a legal habitable space, which differs across jurisdictions. For most jurisdictions this is either 150sf or 225sf.
- Think about space for doors, windows, venting, etc.: A relatively modern house will have a window large enough for egress, but ensure that there will still be enough space for windows, egress, light and venting once you've put an exterior door into the space.
- Think about truly small space living: Note that interior conversions can be trickier than garage conversions because there is usually less space to work with, unless you are converting a common space (such as a den, family room, or other large room). If seriously considering an interior conversion instead of a garage conversion, it would be a good idea to look at designs, blog posts, etc. dealing with living in less than about 200sf upfront.
Note: The tips included in this blog post are information, not advice on a specific property purchase determination, and are not exhaustive. Consult with the appropriate professionals such as your local jurisdiction, your realtor, and professionals on any final decisions.