What they are for

Thirteen reasons people build one

Most people arrive with one situation in mind and discover another one suits them better. These are the reasons that actually come up, including the one hardly anyone considers until it is pointed out.

Family Aging parents nearby

Close enough to help, far enough that everyone keeps their independence. The most common reason people call me about an ADU, and usually the one with the least hesitation behind it.

Downsizing Move into it yourself and rent the house

The one almost nobody considers, and often the strongest financially. You take the smaller unit, the main house rents for considerably more than the ADU would, and you stay on the property you already own.

Family Adult children getting started

A place for someone in their twenties to live properly while saving, without either party pretending the old arrangement still works.

Income Rent it out, stay in the main house

The straightforward version. A year-long lease on a detached unit in much of the region rents in the region of $1,900 to $2,500 a month.

Income Furnished medium-term letting

Traveling medical staff on thirteen-week contracts at UC Davis, Sutter, Kaiser and Mercy. Furnished stays rent well above a standard unfurnished lease. Note that county rules require stays of thirty days or longer.

Family Aging in place, with help

A carer can live on the property rather than visiting, which for many families costs less than assisted living and keeps someone in their own home.

Lifestyle A separate home office

Genuinely separate from the house, with a door that closes at the end of the day. Weaker financially than a rental, and worth saying so.

Income An investor adding a unit

A second income stream on land you already own, without buying a second property, paying purchase costs or triggering a full reassessment on the whole parcel.

Income Adding units to multifamily

California allows additional units on property that already has several, in defined circumstances. Restrictions apply and the rules differ by area, so it needs checking.

Lifestyle Guest accommodation

Room for family who visit often. Honest answer: this is the weakest case for the money, and usually better combined with another use.

Resale Flexibility later

A property with a legal second unit suits more buyers than one without, and what the unit is used for can change as circumstances do.

Business A small residential care home

California treats a licensed residential care facility for the elderly serving six or fewer people as a residential use, and its residents and operators as a family, for zoning purposes. No conditional use permit or zoning clearance can be demanded that would not be demanded of an ordinary home in the same zone. Licensing is a separate matter and the requirements are real, so this needs proper advice before you commit.

Business Running a business from it

A therapy or consulting room, a studio, a workshop, or an office for a business that has outgrown the spare bedroom. What is permitted depends on the nature of the business, client visits, signage and parking, and rules differ by jurisdiction. Worth checking before you build rather than after.

The one worth stopping on: move into the ADU yourself.

Most people assume the ADU is for someone else. Turn it around. You live in the new, efficient, single-storey unit built exactly how you want it, and the main house goes on the rental market at a much higher rent than the ADU would ever achieve.

You stay on your own property, in a home with no stairs and low running costs, and the house you already own starts paying you instead of costing you. For someone whose children have left and who does not want to leave the neighborhood, it is frequently the strongest option on this page.

Whether it works depends on your house, your lot and your numbers. Worth an honest conversation before you decide.

Before you plan around income

What you can and cannot let it for

Nightly letting is generally not available on a newly built ADU here. In unincorporated Sacramento County an ADU cannot be used as a short-term rental unless it was legally permitted before January 2020, and junior ADUs cannot be short-term let at all. If someone has shown you a projection built on nightly rates, it is built on something most owners legally cannot do.
A standard lease

The ordinary route. Detached units in much of the region let in the region of $1,900 to $2,500 a month, depending on size, finish and location.

Stays of thirty days or longer

Entirely allowed, and this is where the interesting market sits. Airbnb runs a thirty-plus day market, so the platform is still usable, just not for nightly bookings.

Traveling medical staff

Thirteen-week contracts at UC Davis Medical Center, Sutter, Kaiser and Mercy. Furnished medium-term units rent well above a standard unfurnished lease, and the tenant turnover is predictable.

Rules differ by jurisdiction. The above is verified for unincorporated Sacramento County; I confirm what applies at your specific address before you plan around it.

Not sure which of these fits your situation?

Tell me what you are trying to solve and I will tell you honestly whether an ADU is the right answer, and what it would cost.

Check my property