construction because contractors must price-in unknowns they may encounter in modifying or building on to an existing structure. Installing an ADU is more like new construction than remodeling. Therefore, savings for a freestanding modular ADU could be much greater compared with a conventional home addition of comparable size that includes a kitchen and bath — high-ticket items in home construction calculations.
The Potential Value of ADUs
One position in the cost versus value argument for ADUs holds that the total cost of installation — plus whatever you may need to spend for home health care professionals to look after sick or disabled relatives — might well be lower than costs for assisted-living or nursing home care, which generally run from $5,000 to $7,000 a month for an individual. There’s a corollary to the total cost argument for ADUs: While you can’t recoup money spent on assisted living or nursing home care, that’s not always the case with an ADU. When you don’t need the space for care, it can be repurposed as a home office, studio, rental unit, guest space or nanny quarters.
Corinne Fitzgerald of Fitzgerald Real Estate in Greenfield, Mass., and vice president of the Massachusetts Association of Realtors, agrees, but with caveats. “As long as zoning regulations allow and the space can be used for another purpose later, an ‘in-law addition’ is a good investment for families looking for a place to accommodate extended family, such as returning kids or parents.”
What is the marketability of an ADU down the road? According to Fitzgerald, how much of the initial costs you can recoup will depend on the real estate market in your area and how elaborate the addition or dwelling is.
“Don’t overimprove,” she advises. “And it’s absolutely critical to check local zoning regulations to be sure that if you are counting on using the space for a particular purpose later, that use is allowed.” She also recommends that you meet with a local Realtor to be sure that a planned addition won’t price your home out of the neighborhood. And before settling on an ADU or any addition, do your homework by looking at the cost of renting a separate space nearby for extended family compared with adding space at home.
Finally, Fitzgerald cautions, the dollar amount may not be the best deciding factor. “There’s much to consider besides the bottom line, including the quality of care for a loved one, travel time and the cost and wear and tear on the caregiver, not to mention your own peace of mind.”
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