Ever heard someone mention an ADU in real estate and thought, “Wait, what’s that?” You’re not alone. The term pops up more and more these days, and it’s actually changing how people think about housing.
What Does ADU Mean?
ADU stands for Accessory Dwelling Unit. It’s basically a smaller, secondary home built on the same lot as a main house. Think of it as a mini home with its own entrance, kitchen, bathroom, and living space.
Here are the most common types of ADUs:
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Detached units (a small house in the backyard).
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Attached units (connected to the main home but with its own entrance).
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Garage conversions (turning a garage into a livable space).
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Basement apartments (separate from the main living area).
In short, an ADU is like adding a bonus home to your property.
Why Are ADUs Becoming So Popular?
ADUs are booming in real estate for a few reasons:
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Rising housing costs: People need more affordable living options.
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Multigenerational living: Families want space for aging parents or grown kids without moving far.
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Rental income: Homeowners can rent out ADUs for extra cash.
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Efficient land use: Cities see them as a way to increase housing without sprawling into new land.
Some cities, like Los Angeles, even streamlined their permit process because ADUs help fight housing shortages.
Key Facts About ADUs
Here are a few things that make ADUs interesting:
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ADUs can increase a property’s value since they add living space.
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Some states like California and Oregon have passed laws to make building ADUs easier.
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An ADU doesn’t always need to be big—some are less than 400 square feet but still fully functional.
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Banks are starting to offer loans designed specifically for homeowners who want to build ADUs.
What to Know Before Building an ADU
Building an ADU isn’t just about adding walls and a roof. There are rules. Each city sets zoning and permit requirements. For example:
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Some areas limit the size of ADUs.
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Others may require parking spaces.
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Utility hookups (like water and electricity) need approval.
It’s smart to check with local zoning laws before breaking ground.
How ADUs Impact Real Estate
The rise of ADUs is shifting the housing market. Homes with ADUs often sell faster and for higher prices because they’re versatile. Buyers see potential—whether it’s rental income, space for family, or even a future office or studio.
Real estate agents are now highlighting ADUs as major selling points. In competitive markets, having an ADU can make a home stand out.
My Take on ADUs
I like the idea of ADUs because they make housing more flexible. If I had one, I’d probably use it as a guest space or maybe even a creative studio. It feels like a smart way to make the most of what you already have.
Wrapping It Up
So, what is an ADU in real estate? It’s a small, secondary home that can boost property value, create income, and give families more options for living. With housing costs climbing, ADUs are only going to become more popular.
Would you ever want to live in an ADU—or build one in your backyard?