Many people want to get into real estate investing but don’t believe they have the resources to do so. It’s easy to look at the people on your favorite house flipping TV show and think that you don’t have the financial means, the technical know how or the network to pull something off like that. However, you may have everything you need to begin your career as a real estate investor right there on your property. While it probably won’t be free to upstart this new investment opportunity, it may not be nearly as costly as you’ve thought. All thanks to something known as an ADU.
What is an ADU?
ADU stands for “Accessory Dwelling Unit.” If that doesn’t answer the question for you, let’s go a bit deeper. An accessory dwelling unit is that room above your garage that you’ve been using for extra storage. Maybe you have a large, finished basement area that has access to all of your home’s utilities or even a tiny house type building in the back yard. An ADU is an area that is already on your property that could be used as a rental dwelling. While there will be permits and other investments that you’ll have to look into to utilize your ADU space, it will be considerably cheaper than flipping a house or buying an apartment complex.
How can I get an ADU?
If you have the area you want to use as an ADU already on your property, you can begin the process of turning it into a money maker for you. The first thing you’ll need to do is research other rentals in your market, as this will help you figure out what you need to make the space and what you can expect to make off of it. Then you’ll need to contact your local government to see what sort of permits you’ll need to get before you’re allowed to rent the space out.
Why should I consider an ADU?
An ADU gives you the opportunity to generate a second income without having to work two jobs or purchase a second property. While you do have to consider the cost of renovating the space and obtaining permits, the market that you’re in may lend itself to a steady stream of ADU income. In the worst case scenario, you fix up a space you already own and end up deciding not to pursue it as a rental. In the best case, you make money off of something you already own.