The Benefit of Adding ADUs to Your Multifamily Property
With the new ADU laws enacted in 2020, owners of multi-family residential structures (properties that contain two or more residential dwellings, such as duplexes, or apartments) have an incredible new opportunity to maximize earning potential by adding one or more Accessory Dwelling Units (ADUs) to their land. There are two methods to go about adding ADUs to a multi-family property: conversions and detached ADUs.
ADU Conversions
Property owners can now convert portions of existing structures that are not used as livable space — such as storage rooms, garages, carports, mechanical rooms, attics, or basements — into ADUs. At least one ADU can be created through this method and up to 25% of the existing unit count. For example, if you have an eight-unit apartment building, you may be able to add up to two new ADUs by converting existing non-livable space, or if you own a 20-unit apartment complex, you can build two detached ADUs and also convert accessory spaces into five ADUs. Keep in mind, you cannot convert spaces that are currently living spaces into ADUs, and you cannot convert uncovered parking (such as a parking lot).
Detached ADUs
If you don't have existing space(s) to convert, but have some extra land, you can build up to two ground-up, detached ADUs (16-foot height limit with 4-foot rear and side yard setbacks) on a property with an existing multi-family dwelling. This 16-foot height limit means that these detached granny flats can only be one story. Also, because of this height limit, you cannot add a second story above an existing garage or carport. Additionally, in most cases, detached ADUs must be separated from the existing structure by 8 to 10 feet.
Adding ADUs to multi-family properties can increase your earning potential significantly. By adding new units, you can increase your rental income and potentially increase the value of your property. In addition, ADUs provide affordable housing options for individuals and families who may not be able to afford traditional housing. By adding ADUs to your property, you can help alleviate the housing crisis in your community and provide affordable housing to those who need it most.
However, there are a few things to consider before adding ADUs to your multi-family property. First, you need to check the zoning laws and regulations in your area to ensure that your property is eligible for ADUs. You should also consult with a contractor to determine the feasibility of adding ADUs to your property.
In addition, adding ADUs to your property may require additional expenses such as permits, inspections, and construction costs. You will need to budget for these expenses and ensure that you have the necessary funds to complete the project. It is also important to consider the impact that adding ADUs may have on your property taxes and insurance rates. OneStop ADU can assist you through the entire process, making it simple for you.
Another important factor to consider is the potential impact on your tenants. Adding ADUs may disrupt the living space of current tenants and may cause inconvenience during construction. It is important to communicate with them and provide adequate notice before starting any construction. You should also consider the potential impact on the neighborhood and the community as a whole such as increase in traffic and parking problemschallenges. But, of course, adding ADUs helps with the community’s housing needs.
In conclusion, the new ADU laws provide an opportunity for property owners to maximize earnings by adding ADUs to their multi-family properties. You can increase your rental income, provide affordable housing options, and increase the value of the property. While it is important to consider the zoning laws, feasibility, expenses, and potential impact on tenants and the community before starting any construction, by carefully considering these factors and planning ahead, and working with a trusted partner like OneStop ADU, you can successfully add ADUs to your multi-family property and take advantage of this new unprecedented opportunity.
