ADU Valuation | LA County

[Franklin Marquette]

When building ADUs, do they generally create value uplift for the property in the same way that the main house is valued?

That is, if the median $/sq ft for an area is, say, $450. Would any new ADU sq ft add $450 / sq ft to the property value OR would it be at a discount because it is an ADU? I know there is of course no set rule out there but just curious on folk's experiences.

Also curious to know folk's thoughts on what the CONSERVATIVE median $/sq ft for the Los Feliz / Silverlake area on LA is.

Thanks all!

[Rick Albert]

I have done a lot of ADUs in LA County. Here's what I have seen:

1. Some appraisers will combine the square footage and go that route and make adjustments. You don't typically don't want this, as this is the lowest evaluation.

2. The more common one is a flat value for the ADU, like they would for a pool or another bonus. This is typically HIGHER than option one.

When did the HELOC on my house with ADU, the first appraiser used option one and I demanded a new appraisal where they would give me a flat value. I got an extra $30K in value out of it.

Appraisers don't use the PPSF because it is grossly inaccurate, despite common belief. Keep in mind the PPSF is the total value, which is land and structure. So if you are doing an addition, you are only contributing to the structure portion of value, not the land value. You have to separate the two. That's why appraisers do the comparative approach and then secondarily the cost approach.

So far, 100% of the time you don't get dollar for dollar back from what I've seen. But that's typical in most cases. You put on a new roof for $30K but the market won't pay you a $30K premium just because of it.