Sometimes, the best project for your home isn’t something for your use only. Building a space that someone else can live in is one of the hottest trends in home improvements. Increasing the living space and possibly adding a separate unit for rental income improves your use of the property and can give you a tidy return on your investment as well. The trick is that you have to make sure you do it correctly. If you’re debating adding an ADU to your property, here are a few things you should know before you start.
WHAT IS AN ADU?
An ADU is an accessory dwelling unit. In short, it’s an additional, separate living space on your property. As a general rule, to have an ADU, you must have a detached home. At the city level, ADUs are popular because they offer a way to increase housing density without having to significantly change the layout. In areas like Portland that have a hot housing market, ADUs increase the supply without affecting the charm of the neighborhood.
HOW DOES AN ADU WORK IN A BASEMENT?
Although you might imagine that most ADUs are separate units on the lot, they don’t necessarily have to be. Converting a basement into an accessory dwelling unit is a popular choice. Many homeowners want to have the benefit of an additional living space that they can rent out or use for multi-generational living. To qualify as an ADU, it must function as a separate residence. Most basements can meet these requirements, but you may have to complete some renovations first.
WHAT ARE THE RULES OF AN ADU?
The guidelines for adding an ADU to your property depend on the city and state laws. You may notice that Oregon has slightly different rules than California, and Portland might not set guidelines the same way as Bend. The good news is that support for ADUs is increasing, particularly in Oregon. If you’re thinking about building an ADU, you’ll need:
- A separate living space that does not require moving between units
- A full kitchen, even if it’s small
- A full bathroom
- At least one bedroom
- A separate exterior door
Most cities set limits on the number of people who can live in an ADU, as well as its maximum square footage.
DO I NEED AN EXISTING BASEMENT TO MAKE A BASEMENT ADU?
Many of the older homes in Portland‘s best neighborhoods do not have a basement. Fortunately, you don’t necessarily need an existing, finished basement if you want to consider this type of project. It’s not uncommon to raise an existing home and convert a crawlspace into a full basement. Excavating a basement is certainly more complicated than renovating an existing one, but it’s not impossible. With the right kind of remodeling company, you may be able to complete this project without sacrificing your curb appeal.
WHY SHOULD I BUILD AN ADU IN THE BASEMENT?
Having an extra living space that you can use in the way that suits you the best is an excellent choice. An ADU gives you maximum flexibility. Building it in the basement is an ideal option if:
- You don’t have sufficient lot space for a detached ADU
- You have a basement that you’re not using efficiently
- You want extra space and privacy for adult children or long-term guests
- You’d like the option to rent out a unit for income
- You want to increase your home’s resale value
You are not required to use it as a separate dwelling. An ADU could also become a perfect studio or business office.
ARE ADUS A GOOD INVESTMENT?
As with any home improvement project, you want to make sure that you’re getting a good investment for your money. Adding a separate living space that you can use for income or your own convenience is a great investment. ADUs and in-law suites are some of the most in-demand improvements that homebuyers are looking for. Because it’s such a popular idea, you’ll notice an increase in your resale value once you complete it. Your return on investment depends on a few factors like the type of home you have and where you live. As a general rule, you can expect to get at least half of what you paid in increased value. You just have to make sure that it counts as an ADU when you’re ready to rent it out or sell the home.
WHAT’S THE DIFFERENCE BETWEEN A SECRET ADU AND A PROPER ADU?
Of course, plenty of people have functional living space in the basement. Some homeowners even rent it out as separate housing. Unfortunately, building a kitchen, bathroom and bedroom in the basement does not mean it qualifies as an ADU. The biggest difference between a secret ADU and a proper one is that you can publicize a real one. Proper ADUs meet requirements for fire safety, living areas, heating, food safety and hygiene. Taking the extra step of ensuring the ADU follows these guidelines is what gets you the major benefits of the investment.
IS A BASEMENT ADU RIGHT FOR ME?
Choosing any home improvement project takes research and an understanding of what you’re hoping to get from the results. For some homeowners, an ADU is an obvious choice because they have a basement that is ready to go and they would love to make some extra income. It might also be a great option if you’re bursting at the seams in your home and you need a little more space that is all your own. For others, it may take a lot of extra work just to get the home in the right condition to make an ADU in the basement. In either case, you’re going to need an expert to guide you.
Are you ready to make your basement into a living space that makes your life easier or even makes money for you? An ADU might be the perfect path to achieving your goals. To find out more about this exciting project or schedule a consultation, contact Cooper Design Build.