ADU - Building a 2 Bedroom versus 1?

1 Reply

I have a detached and permitted ADU (400 SF) which currently is a Studio. I am looking to expand as I have an additional 475 SF of space which is devoted to the garage portion. My debate is the following:

1) Convert the ADU into 2 bedrooms / 1 bath.

Pro's A:) It would generate higher rental income being a 2 bedroom

2) Convert the ADU into a 1 bedroom / 1 bath

Pro's A) Cost less for construction 

Pro's B) By doing so, I can keep the garage door and devote a portion of the garage as a storage area to the front/main unit which will make the front unit more desirable and command a higher rental income from the front unit since a lot of tenants seek having storage/garage space from my personal experience

Pro's C) By making the ADU a 1 bedroom instead of 2, the back unit will likely be rented out by a single individual as opposed to a family.

In addition the resell value of the property would be higher if you add a bedroom.  If possible add a half bath or full bath.  Anytime you can add sq footage on an existing property that is normal you can get your money out of it and them some.  At least in my market anything that is 2 Bed/2 Bath (or even one) goes for more and in addition opens the market up for buyers and renters.  I try not to pigeon hole buyers as much as possible.  Just my 2 cents :)

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