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How To Make ADU Rentals Work For You



|Last Updated: 26 Jul 2022

ADU is a long-term investment, it can be a profitable asset if its financial and legal prerequisites have been well taken care of.

Homeowners build their ADUs for various reasons: expanding the primary dwelling for self-living purposes, adding extra living space for family members, or creating a new avenue to earn a substantial income. However you want your future ADUs to serve your purpose, there are a few things to consider before laying the groundwork. If you belong to those who would like to make a profit out of their ADUs, here’s a quick list of how to make ADU rentals work for you.


  • Focus On One Goal

As your ADU construction plan progresses, you should be pressing towards an ultimate goal. Why is that? Because you could be straying away from your sole purpose of building one. For instance, you’ve decided to have an ADU to have an extra room (customizing it based on your personal preferences, not caring too much about the materials since you’ll be the one using it), then you’ve overheard a neighbor talking about a tenant looking for a place to stay, you suddenly shifted away from your original plan and now you’re trying to revamp the whole plan. Do you see the picture? To eliminate scenarios like these, make sure that you have thought things out beforehand.



  • Scout for (Potentially) Good Tenants

First, make sure to take care of all of the requirements before letting future tenants know about your rental property. Then, search for potential tenants who are also actively looking for house rentals. You should know your priorities, your preferences, and your non-negotiables. Make sure you have a contract ready in case a query pops up from your Messenger. Seek legal advice when screening for your potential tenants, it is always better to have a background check and set a meet-up with them for further clarification.



  • Choose Between Short-term and Long-term Tenancy

It will still depend on how you want your ADU to work for you. For homeowners who would still want to have access to their ADU from time to time, the short-term would be the best choice. But if you’re looking to have a steady flow of income, the long-term best suits you. Just like in any investment, time is always of the essence. Some homeowners are so keen to pay down their hard-earned investment, they would just rent out their ADUs for 6 months to 2 years max. Meanwhile, others would look farther along, letting their rental properties up for lease—earning a considerable amount of income over time.


To sum it up, ADU rental would only work for you if you too are prepared to do your part. When renting out a property, you are lending a piece of your personal space to someone else. For you to create an amicable relationship with your tenants, make sure to start right, be compliant with all the legal prerequisites, and communicate effectively. 


Want to start having your rental property? Leave us a message and let our expert remodeling team build your dream ADU today!


*All images used are from the internet.



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