My family has owned a house with a potential accessory dwelling unit (ADU) built into the lower level in Glendale, CA for many years. The unconventional layout has always posed a challenge for renting it because a lot of families want the bedrooms to be near one another. The layout only appeals to a limited number of potential tenants and at times has been a challenge to rent because of its niche appeal. We are hoping that by legally separating the two levels into separate units we will have an easier time attracting qualified tenants and avoid vacancies and lost income.
The main level has 2 bedrooms and 3 bathrooms. There is access to the lower level through a staircase next to the kitchen. This could easily be blocked off to totally separate the units. The lower level has a bedroom, living room and a space that could be a kitchen because it already has a cabinet, countertop, and sink. There is a separate entrance from the side of the house that opens into an enclosed patio.
What do we need to change?
What changes will we have to make in order to permit the second space and make it comfortable for a separate tenant? The property is due for some changes and upgrades, so now is the perfect time to make changes to the downstairs space. Ideally, we would like to create a small kitchen where the sink and countertop already are so that we can make a true separate unit out of this mother in law suite.
Will the investment be worth it?
Will we be able to increase our rental income by renting the downstairs separate from the upstairs unit? Most likely we will make more from the combined rents of a 2 bedroom 3 bath unit upstairs and a 1 bedroom 1 bathroom unit downstairs than the house as a whole. The question is will the increase in rental income cover the cost of the updates within a reasonable amount of time?
What is the balance between pretty and profitable?
What updates should we make to the property to make it more attractive to potential tenants without blowing our budget? The kitchens and bathrooms need a little love. This house has the potential to be really cool, and if we were making updates for ourselves we would not hesitate to gut the kitchen and the bathrooms and restore it to its full Mid Century glory. Design choices for rental properties are inherently different from design choices for personal homes. We need to choose materials that are easily maintained, durable and a good value.
Our next step…
Our next step is to meet with some experts in the permitting process for ADUs. I will share what we learn and what we decide to do in my next installment.
Informational Seminar on ADUs at DIGGS
Are you considering an ADU for your own home? We are hosting an information-packed session at DIGGS. Our architect, amk design studios will walk you through the state of the rules and practicalities in our communities so you can begin to understand what is involved. Our lender, Shae Case, will help us understand how to get financing for an ADU and his appraiser will help us understand how this will help our home values.
It is important to register- if we get enough interest we may move to a larger venue. Registrants will be notified.