ADUs in the Bay Area
Early this year, the State made it easy for homeowners to add an ADU on their property. On a cap rate basis, it seems like a great deal for homeowners or investors who want to earn some extra income for their property. If you install an ADU for ~$250K, you can rent it out for $2500-$3000 a month. Satisfying the 1% rule in the Bay Area is HUGE!
My question to you is this: What's holding more "buy and hold" investors from constructing an ADU on their property and how can new investors acquire finance the cost of building an ADU if they don't have a lot of equity in the home?