A prefab ADU will save you time and save you money
More than any other time in recent history, homeowners in California have the biggest opportunity to become real estate investors by expanding their portfolio.
California Legislature has given the possibility for homeowners to add an Accessory Dwelling Unit (ADU) to their property. Adding an ADU is a great way for current homeowners to make passive income by converting their single-family home into a multi-family property.
In Southern California, the average market for a 3 bedroom and 2 bath rental unit is approximately between $3,600 to $4,300. This means that any expenses towards converting your home into an ADU would be covered in addition to having a new source of passive income on a monthly basis.
In addition to creating passive income, the homeowner’s property value would increase exponentially. In other words, by adding an ADU, the homeowner’s property value could increase by 100% or more. If the homeowner later decides to sell the property, the marketed value would sell as a multi-family home as opposed to its original single-family price.
For instance, if you own a house that is worth $750,000 and you add an ADU that will cost $250-300k now your property will be valued at $1,250,000, giving you an added value of up to $500k and you have only spent between $250-300k. That is a gain value in equity of $200-250k. Additionally, after paying your mortgage, taxes, insurance, you could stand to net as much as $2,000 per month.
If your property qualifies for an ADU and you are looking to maximize income potential and value maximization it would be counterproductive not to do it.
This process does not change the ownership of the property, if you finance your ADU, you control 100% of the funds.
Below is the link to the California ADU Handbook, in which you will find all State bills and laws that make this process possible.
Provide your property’s information to determine if it is eligible for 1 or more ADU placements.
We may need to contact your municipality to ensure that your municipality is following the state guidelines.
Build time takes approximately 3 to 4 months (permit times may vary city by city).
Your ADU will be built off-site at a factory. While that is happening we will be busy installing the water, sewer and electrical hookups. If your municipality requires a concrete foundation we will be doing that as well while we wait for your unit to arrive.
During the construction of your ADU, we can help you with tenant acquisition, tenant screening, helping navigate California tenant laws and ensure that your rental business is successful.
If you need financing we can help.
We work with banks that lend you money based on the improved value of your property instead of the current real estate value.
If you have a currently low-interest mortgage in your property you don’t need to refinance, this can be done through a line of credit.
If you need more information please contact us.
