Just get some plans and an estimate. Tell the future buyer what a great value it is. Sell the lie, not the facts. Plenty of ADU fans. But in reality very few are built because the dream becomes a nightmare when you get into the weeds of dealing with bureaucrats and contractors and finally tenants. BTW… it is very difficult to sell when your ADU is occupied. We evicted my parents tenants from their ADU before we put their house on the market after they passed. I realize this advice is unsolicited. But since you put it out there…… I think all ADU fans should think about how you sell your property with an ADU especially with a tenant that won’t leave. I waited for my ADU tenant to leave before I sold my Emerald Hills house. His schedule not mine. Plus I think most buyers don’t place any value on an ADU. I know my bank placed very little value on mine. I had to find a unique cash buyer with a live in maid to sell my house at about a 10% discount price per sf compared to neighboring solids. I truly believe that an AFU actually devalued the property. The extra 600 sf would have brought a higher sales price if it have part of the main house.
The rental house I bought in Tahoe sold for a lower price than other houses without the ADU. Regular buyers weren’t interested. I considered it like a duplex. Great ROI. But have had trouble with the tenants getting along( dogs snow removal, general yard maintenance created issues) even on a large 3/4 acre property. So now it’s rented to one tenant
No, I appreciate any and all suggestions from you and everyone else…
Well, there is this $40K grant program that I want to take advantage of. It is not tech free money towards an ADU but it does cover the pre build stuff so it is like free money in that you don’t have to pay it back but you do need to use the approved lenders. My mortgage contact’s broker is getting set up for this. The idea is to have the ADU up and running but not rented out. The idea is to make this property shine as much as possible before heading to market. I have this land that needs to be repurposed. I have already made a patio with a basketball court on it and have a gazebo on the other end.
Here is that ADU grant program info if anyone wants it. The income levels are actually kind of high for qualification especially if one only uses his/her own income salary.
Yup, and sleepy I do want. I’ve worked enough in my life. With no kids, time to enjoy myself more. If I want KL lifestyle I mind as well move back to San Francisco…
Interesting program. The problem is it’s costs $350/sfminimum to build. So a thousand sf ADU in tahoe costs $350,000 just for the building. Let alone the $40k for development costs. The 2 bedroom ADU would rent for $2500/m in Tahoe. Net income would be $20k per year. There are $350k condos that would give a better ROI. And none of the hassle with bureaucrats and builders.
Well, I don’t intend to go with normal stick build ADUs. Trying to throw up out there a prefab or even shipping container designed one. I want to stay below $200k total if I can do it. I just want to show some value, not present a freaking new house on the property (although that would be cool) to the buyer.
Well, it looks like they thought it was underpriced so they increased it and then probably reality hit when no offers or too low offers came through and now the dreaded price cut. It may still work out. This is after all LAH after all… Had they listed it $3,888,888 I guarantee it would be in escrow now…
Well, no more 1.1M discount. They just raised the price again. Can’t they just make up their damned mind?
Backs up to the 280…no thank you!
For *ADU Financing I’d recommend a former employer of mine - loanDepot - specifically Milton Manolis who is the head guy of their Renovation / 203k / ADU programs. He would put you in touch with the right person in your area.
(312) 656-4032 - cell.
Not many people really specialize in this lending niche so you have to be careful who you work with.
PS - I get zip out of this referral other than knowing the reader will get a high level of help in this matter which is needed to keep things clear, true, and deliverable.
Appreciate it @LbJW but my personal mortgage contact is trying to get set up under this CA $40K grant program. I can trust her to not build in too many unnecessary charges/fees.
No worries. Work with who you are comfortable with.
FYI: Milton M. worked directly with CalHFA to create and deliver the product. Not many people around who know this product as intimately as the original source of it.
Home price begin falling.
Homes having price cuts highest since Redfin started tracking data in 2015.
“In June 2022, Santa Clara County home prices were up 6.0% compared to last year, selling for a median price of $1.5M. On average, homes in Santa Clara County sell after 12 days on the market compared to 10 days last year. There were 1,347 homes sold in June this year, down from 2,010 last year.”
“In June 2022, San Mateo County home prices were down 4.0% compared to last year, selling for a median price of $1.6M. On average, homes in San Mateo County sell after 12 days on the market compared to 10 days last year. There were 508 homes sold in June this year, down from 767 last year.”
“In June 2022, San Francisco home prices were up 2.0% compared to last year, selling for a median price of $1.5M. On average, homes in San Francisco sell after 17 days on the market compared to 16 days last year. There were 547 homes sold in June this year, down from 787 last year.”
Only San Mateo county has a yr/yr price decline. DOM is still super lower. I’m not sure why people are getting so excited. Does no one pay attention that prices peak in spring then decline through the end of the year? Does anyone think that next spring prices will be lower than this year? The only way that happens is if we hit a recession at which point rates will be dropping.
Good point of view… 
I don’t think any significant movement has happened yet. Not sure if it will or not.
right? we gained 50% in 1 year. I am sure it will go down, but craaaazy
The bottom feeders are already looking for RE. A Bay Area investor just called bragging about stealing 4 multi family buildings in San Jose. Wants to steal some of mine. I am not buying or selling currently.