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10 Steps to Build an ADU on your property
ADUs are a great source of passive income if you own a property in California. Building a detached ADU is much easier as opposed to an addition to the existing house. When you also have the active collaboration of the state and local government to help you achieve it, the decision of having an ADU on your property becomes very appealing.
Step 1. Check if you're allowed to have an ADU on your property and how large it could be.
Some jurisdictions impose the minimum size of an ADU and all of them set a maximum size, approx. 1,200 sq. ft. You want to know the maximum size you're allowed by zoning regulations but also how large of an ADU could fit in your backyard. If your property has an existing legal building in the rear yard, such as a garage or storage shed, this may be eligible for conversion into an ADU.
Step 2. Decide on what goals you want to achieve by building an ADU.
Is this unit helping you pay the mortgage by creating a rental apartment? Is it going to house multi-generational households or an older homeowner could move to the ADU while the children live in the main home? Depending on its primary use, you might realize that the size of the ADU may not satisfy your final goal.
Step 3. Meet with the Planner for a pre-application meeting.
Take your ADU report to the Planning Department for a pre-application meeting. Submit a screening form to the Department of Building Inspection (DBI).
Step 4. Get Financing
Contact your mortgage broker to see if they have products for building an ADU. You may also explore a home equity line of credit or HELOC. Check also California Housing Finance Agency to see if you qualify for additional funding.
Step 5. Hire a professional to draft the drawing set.
Design your project and finalize construction drawings.
ADU Analysis calculates the maximum ADU area for the highest return.
Step 6. Hire a General contractor
Contact contractors to get cost estimates and time frames for the project. Here is a good article about the costs you'd have to take into consideration when putting together the budget.
Step 7. Apply for permits
The Planning Department and other city agencies review. If expansion is proposed this process will include Neighborhood Notification. We advise you to hire a professional to put together the set of drawings for permits unless you've already done so on step Four.
Step 8. Start construction
Your architect should have the contraction drawing (CD) set ready for your GC to start construction.
Step 9. Get the Certificate of Occupancy
Once the construction is completed, schedule the final inspection with the city inspector. If no objections are made during the inspection, you should get the Certificate of occupancy.
Step. 10. Start to market for rent
Now you have the ADU ready for your tenant to move in!