Why an ADU is a Smart Financial Decision
Maybe you’re in the market for a home and are having a hard time finding the right one that fits your budget. Or perhaps you’re already a homeowner in need of extra income or a place for loved ones. Look, at The Newcomer Group, we get it. The U.S. housing market is tight right now, but our team doesn’t see this as a hurdle to overcome, we see it as an opportunity to look for new opportunities. In a popular town like St. Augustine, Florida where prices continue to rise right alongside interest rates, that can mean thinking about creative solutions to put our clients in the best situation possible. Whether as a potential homebuyer or a homeowner with changing needs, accessory dwelling units, or ADUs for short, may be exactly what you need to reach your goals.
What is an ADU?
Accessory Dwelling Units, or ADUs are not a one size fits all concept. According to the AARP, an ADU can be a “small residence that shares a single-family lot with a larger, primary dwelling…An ADU can be located within, attached to, or detached from the main residence. It can be created out of an existing structure (such as a garage) or built anew.”
St. Augustine, the Oldest City in America and home to globally-recognized events like the annual Nights of Lights, is no stranger to short term rentals. However, not every AirBnB or VRBO qualifies as an ADU. AARP explains “an ADU is an independent, self-contained living space with a kitchen or kitchenette, bathroom and sleeping area.”
If you’re thinking about whether an ADU makes sense for you as a buyer or a homeowner, here’s some useful information and benefits that ADUs can provide. Keep in mind, the regulations for ADUs vary based on where you live. You can find resources specific to Florida readily available online, or reach out to us at The Newcomer Group and we’ll be happy to walk you through everything you need to know.
The Benefits of Accessory Dwelling Units
Generate Rental Income
If you own a home with an ADU or if you build an ADU on your land, it can help generate rental income you could use toward your own mortgage payments. It’s worth noting that because an ADU exists on a single-family lot as a secondary dwelling, it typically cannot be sold separately from the primary residence. Considering properties with ADUS is one of our biggest pieces of advice for those looking to get into the world of real estate investing. You can purchase your first home and build your portfolio at the same time by renting the ADU to everyone from family to friends to tourists.
Live Together While Having Separate Spaces
ADUs allow loved ones to live together, while having separate spaces. That means you can enjoy each other’s company and help each other out with things like childcare, but also have privacy when needed. As much as we may love our family, even the closest of us need a break sometimes!
Age in Place
Similarly, ADUs allow older people to be close to loved ones who can help them if they need it as they age. It gives them the best of both worlds—independence and support from loved ones and the ability to age in place. For example, if your parents are getting older and you want them nearby, you may want to buy a home with an ADU or build one onto your existing house.
Less Expensive to Build
Lastly, since ADUs are often on the smaller side, they’re typically less expensive to build than larger, standalone homes. Building one can also increase your property’s value. If you’re ever looking to sell your home, other savvy investors will be attracted to your property for all of the reasons outlined above.
ADUs have great advantages for buyers and homeowners alike. If you’re interested, reach out to the Newcomer Group today. We can help you understand the local codes and regulations and even take a look at what’s on the market right here in St. Augustine.