ADU maintenance costs; estimates?

[Steven Weiss]

Hi all,

I currently plan in building a 1200 sq ft 3 bedroom 2 bathroom ADU in Los Angeles, CA. I ran numbers and everything seems to check out (at minimum, I break even). I just wanted to double check some things, and get alternate opinions regarding cost for the following:

1. I list home insurance for the ADU at 150/month

2. I list earthquake insurance at 150 / month

3. I post maintenance cost of 500/month ( I know this isn't entirely accurate, I typically just have lump sum cash on standby for maintenance issues that arise)

4. I'm assuming the ADU will be considered being assessed for 400,000.00 Please let me know any of your experiences in how much your ADU was assessed for, as I'm assuming my property taxes will be 1.25-2% of this. Thus, as of now, I'm assuming property taxes of about $400/month.

5. Using fixed rate home equity loan (not a line of credit) to fund the project, I'm calculating approximately $1000.00/month of deductible interest. Approximate loan cost @ 6% rate per month is 1700.00. (People will most likely state the loan amount used to produce this project is too small, as many use contractors. That's fine, I'm not willing to debate this. I will be using a loan amount of approximately 200k-240k).

I ran NPV calculations along with other ratios, and everything pans out. I'm currently involved in a different ADU project for a similar property, and that's pretty much where I'm pulling my numbers from for construction costs.

Again, my overall question is, are my home insurance figures / earthquake insurance figures / property tax calculations appropriate assumptions? Some will tell me to speak to an agent, but I wanted ideas prior (so I have a baseline before an agent may decide to try to upsell). Thank you all again for your feedback it's always appreciated!