The San Diego Guide to Rent your ADU
Are you considering renting out your accessory dwelling unit (ADU)? These units can be a great source of passive income, but it's important to understand the process and legal requirements before diving in.
Here is a step-by-step guide for renting out your ADU:
- Check the laws and regulations: It's important to understand the legal requirements for renting out an ADU in your area. This may include obtaining a permit, following zoning laws, and adhering to local housing regulations. For example, in California, it is now possible to build an accessory dwelling unit (ADU) on a rental property and use it for rental income. Previously, state law required property owners to occupy the primary home in order to rent out their ADU. This requirement has been suspended for the period between January 1, 2020 and January 1, 2025. This means that property owners can add an ADU to their single or multi-family rental properties. This change in legislation applies to any ADU that is permitted during this waived period.
- Determine the rental rate: Research the market rate for similar properties in your area to determine a fair price for your ADU. Be sure to also consider any additional costs, such as utilities and maintenance. Here’s a look at current housing prices throughout San Diego:
|Neighborhood||Media 1BR Rent||Median 2BR Rent||Year to Year Rent Growth|
Source: Apartment List - January 2023
- Prepare the unit: Make any necessary repairs or updates to the ADU before listing it for rent. This may include painting, replacing flooring, or replacing appliances.
- List the unit: There are a variety of ways to advertise your ADU, including online marketplaces, social media, and local classifieds. Be sure to include clear photos and detailed information about the unit, as well as your rental terms and expectations.
- Screen potential tenants: It's important to carefully screen potential tenants to ensure that you find a responsible and reliable renter. This may include conducting a background check and verifying employment and rental history.
- Sign a lease: Once you have found a suitable tenant, it's important to have a written lease in place outlining the terms of the rental agreement. This should include the rental rate, duration of the lease, and any rules or expectations for the tenant.
Renting out an ADU can be a rewarding way to generate passive income, but it's important to be prepared for the work this may require and keep up to date on local laws to ensure a smooth process. With careful planning and consideration, you can successfully turn your ADU into a profitable rental property. However, if the prospect of renting out your ADU seems daunting, you may want to consider partnering with OneStop ADU’s sister company, Onyx Property Management. You can learn more about Onyx at onyxpropertymanager.com. Together, our teams are experts in building and renting ADUs in the San Diego area.
Ready to begin planning for your ADU? Visit our website onestopadu.com. If you have questions or would like to schedule an in-person meeting and a complimentary feasibility study of your property, contact us by phone at 858-437-8476, or email at email@example.com.