Updated about 6 years ago on . Most recent reply
Single Family House Hacking
Hello Bigger Pockets Forum! I am 21 years of age and I have been looking to purchase a single family home with a detached garage that way I am able to convert the garage into a separate adu and rent out the 3-4 bedroom house. There is just one problem i live in an expensive area. Cities including West Hills, Woodland Hills, Calabasas, Canoga Park, Northridge, etc. I do not go to school and I've been working and saving for 2-3 years now. Median price of my area is very expensive and I am not sure what to do. It might go down after this pandemic is over but even then it might be a tad bit too high. Would you guys suggest moving to maybe a less expensive area like Santa Clarita or even the IE? Also if you guys have experience with making a garage into an ADU and living in it please feel free to share. I am all ears. Thank you.
Most Popular Reply
If you do the ADU right, it's going to be expensive. What are you plans on financing? 203k loans are great for making ADUs since they're basically rehab loans, but they do have some catches to them. I'd recommend you do your research into them because I feel the pros outweigh the cons. My buddy converted his garage (detached) into an ADU and wound up spending in the neighborhood of 80k on it. He split the water, but did not split the gas, instead he went full electric and it's a studio apartment he made it into.
In terms of living in the area, I live in Granada Hills, and have friends that live in Chatsworth, Sherman Oaks, Canoga Park, basically Valley wide, so I'm familiar with the market out here, and yeah it's not cheap. Have you given any thought to out of state investing? Maybe in a cheaper market while you rent out here? That's what I am doing currently until the market drops.
You could also rent hack out here and buy a condo and rent out a room or two. Just an idea.
Have you been pre-approved so you know what you're working with?