Playbook #090: ADUs
🖼️ The Big Picture
ADUs, or “accessory dwelling units” are additional homes built on your existing property for the purpose of renting, Airbnb-ing, or housing family. With home and rental costs skyrocketing, ADU’s are a popular “house hack” for those looking to bring in extra side-income.
They can be attached — like a loft over your garage (or even turning your garage or basement into an apartment), or detached — like putting a tiny home or casita in your backyard.
To CAPITALIZE on this opportunity, you can either:
- Invest in single family properties that have an ADU already built (so renting 1, 2, or even 3 units on 1 lot), or…
- Invest in single family properties with enough real estate and zoning allowance to add an ADU, and have that built while you are renting out the main property.
- Build an ADU on your own property for extra short term or long term rental income.
Wise investors often prefer to hold real estate (almost) forever. Wealthy people typically don’t sell, they borrow against their assets (refinancing is tax-free) and reinvest the capital.
Just make sure you look into zoning regulations in your area and hire the right team to help you build it. Also be aware that your property taxes may go up because you’ve increased the value of your property.
Whether you’re looking to take advantage of extra space on your lot and add some side income, or invest in properties that have ADUs, this is an excellent way to start building your real estate portfolio and rental income with relatively low risk.
🔢 By The Numbers
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