Accessory Dwelling Units 101

A primer on the ADUs trend for granny pods, home offices and artist dens.

If you could use a little more living space, one flexible solution you might be considering is building an accessory dwelling unit, often referred to simply as an “ADU.” You may also hear people call them “granny flats.”

Over recent years, accessory dwelling units have become increasingly popular. But chances are good you have a lot of questions about them. In this guide, we are going to explain to you exactly what an ADU is, what its benefits are, and what you should know about ADU regulations.

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What is an ADU?

The easiest way to explain the definition of an ADU is simply to think about what the name “accessory dwelling unit” means. Substitute the word “extra” or “additional” for accessory,” and it becomes easier to understand. An ADU is simply an “extra dwelling unit” on your property.

That means that regulations generally stipulate that an ADU include a kitchen and a bathroom. But the exact requirements for the kitchen and bathroom may vary from one jurisdiction to another.

The nickname “granny flat” also helps to convey what an ADU is, viewed in terms of what it can help you accomplish.

Maybe you have a relative you want to take care of on your property, but you want them to have a residence of their own.

Building an ADU lets you move that person onto your property, while allowing them greater independence and privacy since they have their own little residence, complete with everything they need.

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Types of Accessory Dwelling Units


There are a few different ways you can build an accessory dwelling unit:

• Build an attachment. If you want the ADU to be connected to your primary residence directly, you can add it on to your home. It may go on any floor. This is popular option for modular construction.

• Construct a detached ADU. Usually when someone mentions they are building a “granny flat,” they are talking about building a standalone cottage in their backyard as an accessory dwelling unit. Indeed, another term you can use to refer to this style of ADU is a “backyard cottage.”

• Convert your garage. If you do not want to build a standalone structure or add rooms to your home, you could instead convert a room that already exists, such as your garage.

• Make an interior conversion. While garage conversions are perhaps the most popular option, there are other rooms in your home that you also can convert into ADUs. The basement is often a good choice. This type of ADU may even be referred to as a “basement apartment.” It could also be called a “secondary suite.”


When choosing a type of ADU to construct, you will need to consider the following:

  • The regulations in your area.

  • The constraints imposed by your existing home and terrain.

  • The lifestyle considerations that affect you, the other current residents in your home, and the person(s) who will occupy the ADU.

  • How much it will cost to build a particular type of ADU.

What are the Benefits of ADU's?


There are quite a few advantages to constructing an ADU on your property.

Some of these include:

  • Make it easy for a relative or friend to live on your property. Maybe your aging parents need extra care, or perhaps your adult child cannot afford to get their own place. Either way, an ADU allows you to keep costs to a minimum for you and your loved ones while maximizing privacy and independence for all.



  • Rent out your ADU. Need to make some extra money? You could build an ADU specifically to rent out to a tenant. Alternately, you could live in the ADU yourself and rent out your main residence.


  • Have a guest house ready for visitors. Some people build ADUs not to host long-term residents or tenants, but simply to have a place to put up short-term guests now and again.


  • Use your ADU for your own purposes. With more people than ever working from home, the ADU can serve as the ideal home office. It also can work great as a craft room, reading nook, or just about anything else you can think of. Make it your private escape in your own backyard.


  • Boost your property value. Because an ADU is such a useful multifunctional addition, it can raise the worth of your property.


  • Reallocate your ADU to another use later. The flexible design of the ADU means that it can serve a different purpose in the future than it does now. Maybe you build it originally for your child to live in, but after they move away, you use it as a guest house. The possibilities are boundless.

What caused the sudden popularity of accessory dwellings?


Interest in ADUs has skyrocketed over the past few years. Here are some of the reasons why more and more people are constructing accessory dwelling units.

• There is a serious demand for affordable housing solutions that are ideal for 1-2 persons right now to rent in metropolitan areas and beyond. This has been nothing short of an all-out housing crisis on the west coast over recent years.

• Just as there is a large population out there struggling to find a place to live, there are also plenty of people who could use extra income. Renting out an ADU to earn that passive income can be a great way to build wealth.

• In order to increase the availability of this type of efficient housing, many jurisdictions have been simplifying and streamlining ADU regulations to make it easier for people to build these units. Plenty of individuals are taking advantage of these changes.

• It is no secret that many people have been struggling financially since the recession. So, it is more common than it was in the past for family members across generations to choose to reside together to support each other.

• With the pandemic changing the way we work, many people are looking for better ways to work from home. It can be difficult for everyone to focus on their work if they share the same space. An ADU can provide a peaceful, separate environment in which someone can work without distractions from other members of the household.

How Much Does An ADU Cost to Build?


The price range for building an ADU is quite widely across North America. At the lower end, you may be able to handle the construction or conversion for as little as $25,000. At the upper end, however, costs can exceed $300,000.

What factors determine the cost of building an accessory dwelling unit?

  • The type of ADU, its size, its location on your property, and its style may all influence what it will cost to construct.


  • Certain materials may be more expensive than others. Keep in mind, however, that the long-term costs for maintenance may also differ. Sometimes it is worth spending more for construction if it means reducing maintenance costs later.


  • The timing for your project can impact your budget as well. Materials that are more expensive today could be less expensive later this year or vice versa.


  • An ADU must have a kitchen and bathroom, as we discussed. But that means you need to be able to get utilities out to your structure. How involved that is and how much it costs can vary.


  • DIY vs Contractor. You will need to either contract with professionals to build your ADU or take the DIY approach (or, alternately, a combination of the two). You can save money if you are able to complete some steps on your own, especially if this does not require time out of work.


While that is not an exhaustive list of all the factors that can influence the cost to build an accessory dwelling unit, it gives you an idea.


One idea for saving money on your ADU is to choose prefab construction. While you may pay more for upfront (not always true), prefabricated components can cut costs over the long run. Plus, over the long term, you will reap in savings with reduced energy costs and maintenance, thus reducing the costs for upkeep of your ADU.

What to Know About ADU Regulations


Finally, no discussion of ADUs is complete without talking about regulations for accessory dwelling units.

The requirements you have to follow when building an ADU are set by your local authorities.

Look up your local ADU ordinance to discover:

  • Legal zone codes for ADUs in your area.

  • The minimum and maximum square footage allowed for your accessory dwelling unit.

  • How many ADUs you are permitted to construct on your lot.

  • Requirements for fire safety for accessory dwelling units.

  • Aesthetic requirements for your ADU.

  • What the kitchen and bathroom for your ADU will require, and any other regulations concerning utilities.

  • Any owner-occupancy rules that may be in effect.

  • Whether it is legal for you to rent out your DU.

  • Whether you need to provide parking, and what specific regulations there are regarding it (this can get rather complex in some jurisdictions).

  • What documentation you need to submit before commencing building.

  • Any other rules regarding the construction and use of accessory dwelling units for your area.

Since ADU laws are subject to change (and changing fast in some jurisdictions), you should always research current ordinances before proceeding, even if you were familiar with past regulations.