Accessory Dwelling Units (ADUs) are becoming a popular way for homeowners to earn rental income and increase the value of their property. This example shows how one homeowner made a smart decision to build an ADU – and got solid returns in just a few years.
Why the ADU Was Built
In 2019, a retired builder decided to invest in an ADU instead of putting money into the stock market. He chose to work with Wolf Industries after seeing one of their homes being installed in his neighborhood. The process was quick and smooth, and construction took about two months from delivery to move-in.
Rental Income Over Time
After the ADU was set up, it was rented out right away. Rent started at $1,300 per month and later increased to $1,350. The homeowner kept the rent reasonable to attract good tenants, which helped avoid issues or vacancies.
Big Impact on Property Value
When it came time to sell the main property in 2024, the ADU made a big difference. Real estate agents estimated the property would have sold for about $650,000 without the ADU. Instead, it sold for $775,000. That’s a $125,000 increase in value, on top of several years of rental income.
The home sold fast – within 48 hours – because the buyers were specifically looking for a property with a second unit. In this case, the ADU allowed their family to live close together on the same lot.
Low Maintenance Over 5 Years
The ADU held up well over time. There were no major repairs needed – just basic maintenance like cleaning the roof and gutters. One appliance needed fixing, which was covered under warranty. The interior also stayed in great shape after five years of renters.
Key Takeaways
This example shows how building an ADU can pay off in multiple ways:
- Rental income helps recover costs quickly.
- Resale value increases, especially in markets with demand for multi-unit living.
- Low maintenance makes it easier to manage than a full-size rental property.
For homeowners looking to invest or add value to their property, ADUs offer a simple and effective option. Click here to learn more about Wolf ADUs and modular homes and start your journey to real estate investment today!