Americans spend a significant amount of their monthly income on debt payments. And the biggest one? The mortgage payment.
For most people, this line item is the biggest expense, month after month. Of course, it’s important, and it’s worth paying.
But wouldn’t it be great if someone else could pay your mortgage for you? Wouldn’t that open some new doors for you, to save more, invest more, travel more, and enjoy life more?
Countless people across the U.S. are living this lifestyle right now, thanks to having an ADU built on their property. You can hire an ADU builder to build a small accessory dwelling unit, either attached to your current home, or detached in the backyard, and rent it out.
And ideally, the monthly rent covers your mortgage and the debt you incurred while building the ADU.
So what does it take to hire a licensed ADU builder? Read on below to find out now.
Decide What Type of ADU You Want
Before you can hire anyone, you need to have an idea of what you want to build. ADU is a broad term and means different things to different people.
In general, an ADU is a completely separate living space on your property, complete with a sleeping area, kitchen, full bathroom, and appropriate utilities.
They are small, self-contained apartments. And they can either be attached to your current home (which is required in some areas) or detached, to create some distance.
Many people will even build out their basement, as long as it has a separate entrance, to become an ADU. So what type will you choose?
An attached ADU is often the easiest and most affordable to build. Many homeowners will choose to build an upstairs studio or one-bedroom unit above the garage.
Others may build an addition to the home, connected to the main property by a breezeway. And many choose to build a detached mother in law suite.
These can be just a few feet away from the home, or they can be on the back corner of the lot, in the backyard.
With a detached building, you can either work with a company that builds prefabricated units or plan a build from scratch.
Decide How You Will Approach the Build
There are two main ways you can approach the building process once you’ve decided which type of ADU would work best for you.
You can either have an architect draw up custom plans from scratch, and then allow contractors to bid on the project. Or you want to work with an all-in-one designer and contractors.
Working with an ADU-specific company, your contractor will already have a handful of designs for ADUs that you essentially choose from. You can customize some of the colors and appliances in the home, but in general, you are using someone else’s design.
If you’re willing to relinquish control a little bit, this process can be much more efficient. The build gets done faster, and you pay less money. Especially since you don’t have to pay an architect to draw up a brand new set of places, which isn’t cheap.
By going the traditional route, working with an architect, you can truly design something you love, that fits in well with your current home and yard, and appeals to a certain type of renter.
Costs are higher, and the process can take longer, but the result is a structure that feels more like it belongs.
ADU Building Experience
When you’re choosing a contractor to build your ADU, not every general contractor is going to fit the project. For many contractors, an ADU is too small of a project for them to take on.
For those willing to do the work, it’s important to work with a contractor that has done ADUs in the past. They are a different type of home to build, with a much smaller footprint and streamlined space.
There isn’t room for errors in these small spaces.
You also need to consider what the ADU will be used for. Is it going to house additional family members? Will it be rented out long-term?
Will it be rented out short-term for vacation rentals, or used as a studio or office?
The final use-case may determine who experienced your contractor needs to be in order to handle it.
Consider the Timeline
Once you start talking to contractors, one of the first questions you need to ask is about the timeline. Good contractors have full schedules. It can take many months before they can even begin a project, and another few months to complete it.
If you would like it built and rented out within a year, you need to find a contractor that can start right away, which is much easier if you’re not in a metro area.
Pay attention to how contractors communicate with you during the quoting process. Do they return your calls, or are they hard to get a hold of? Their style of communication will remain consistent throughout the entire project.
ADU Building Budget
Every contractor and ADU builder is going to have a price. But ultimately, you need to determine how much you are willing and able to spend.
Most people use equity or debt to pay for their ADU. Many get a construction refinance, which provides them with a budget to construct an ADU, wrapped into their mortgage.
Your budget may limit which contractor you can choose. And costs can vary widely, depending on the design, size, and the area you live in. Expect to spend between $80,000 and $200,000 from start to finish.
Ask Around
ADUs are becoming more and more popular in major cities and suburban areas, as families are creating multi-generational households, or looking for ways to earn extra income.
Chances are, someone you know has built an ADU, or someone in your neighborhood has one. Get some information about the contractor they worked with, and their experience.
And any time you are researching contractors, make sure you are reading online reviews. You can learn a lot about their building quality and communication like this.
Hire an ADU Builder With Confidence
It’s not an easy process to hire an ADU builder. It takes time, many emails and phone calls, and determination.
But finding the right builder is worth the effort. When lots of money is on the line, as well as future income and your current property value, you need to make the right decision.
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