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Accessory Dwelling Unit Requirements
One ADU is allowed on 1-, 2- and 3-unit properties.A 1-, 2- or 3-unit property with an ADU must comply with the zoning and land use requirements for the jurisdiction in which it’s located. Acceptable zoning classifications include legal, legal non-conforming or locations with no zoning. Get Our Pools and Gym Models for your Back Yard as well!Exception: An ADU on a 1-unit property may have illegal zoning under certain conditions.ADUs that are manufactured homes are allowed under certain conditions.
ADU Fact Sheet
Home Ready Mortgage Rates
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ADU's for Extra Income
100% ADU project financingThis financing option will cover the entire project cost!
No payments for 18 monthsZero payments required for the first 18 months
6.99% fixed Annual Percentage RateOur financing offer comes with the lowest APR of 6.99%.
*For qualifying borrowersIncrease property ValueWith an ADU, the value of your property will increase at least 20% Generate passive incomeGenerate passive income by renting out your ADU.
No payments for 18 monthsZero payments required for the first 18 months
6.99% fixed Annual Percentage RateOur financing offer comes with the lowest APR of 6.99%.
*For qualifying borrowersIncrease property ValueWith an ADU, the value of your property will increase at least 20% Generate passive incomeGenerate passive income by renting out your ADU.
Need to know more about our 100% ADU Financing at a 6.99% APR and deferred payments for 18 months?
How can an ADU be used as a home office or workout space?
An ADU (Accessory Dwelling Unit) can serve multiple purposes, including being utilized as a home office or workout space. If you live in a bustling urban area and work from home, an ADU can provide the perfect setting for a dedicated home office. The separate structure offers privacy and tranquility, enabling you to focus on your work without the distractions of your main living space.
Furthermore, an ADU can be transformed into a workout space to support your fitness goals. By converting this space into a personal gym, you can exercise conveniently within the comfort of your own property. This eliminates the need to commute to a crowded gym or fitness center, allowing for a time-efficient and convenient workout routine.
Whether you practice yoga, or meditation, or require adequate space for clients in therapy sessions, an ADU can cater to these needs. The seclusion of an ADU creates an atmosphere reminiscent of a peaceful oasis, promoting a sense of calmness and solitude. By constructing an additional dwelling unit on your property, you can effectively leave behind the everyday hustle and bustle of the city, finding solace and focus within the confines of your ADU.
Furthermore, an ADU can be transformed into a workout space to support your fitness goals. By converting this space into a personal gym, you can exercise conveniently within the comfort of your own property. This eliminates the need to commute to a crowded gym or fitness center, allowing for a time-efficient and convenient workout routine.
Whether you practice yoga, or meditation, or require adequate space for clients in therapy sessions, an ADU can cater to these needs. The seclusion of an ADU creates an atmosphere reminiscent of a peaceful oasis, promoting a sense of calmness and solitude. By constructing an additional dwelling unit on your property, you can effectively leave behind the everyday hustle and bustle of the city, finding solace and focus within the confines of your ADU.
How can an ADU support adult children and college graduates?
An Accessory Dwelling Unit (ADU) can significantly support adult children and college graduates in multiple ways. As new research suggests, a growing number of young Millennials are expected to move back in with their parents after completing their college education. This financial predicament is primarily driven by two key factors: the burden of student loan debt and the increasing cost of housing.
Graduating with an average debt of $37,172 puts immense strain on the financial stability of young adults. Coupled with skyrocketing housing prices, it becomes challenging for them to find an affordable place to live. Here is where an ADU comes into play as a viable solution.
By constructing an ADU on your property, you provide a separate living space for your adult children, offering them independence while still being under the same roof. The affordability of an ADU makes it a practical option for young adults who are seeking to get their feet on the ground. Charging them a minimal and fair rent allows them to save money while benefiting from the convenience and support of living close to home.
Graduating with an average debt of $37,172 puts immense strain on the financial stability of young adults. Coupled with skyrocketing housing prices, it becomes challenging for them to find an affordable place to live. Here is where an ADU comes into play as a viable solution.
By constructing an ADU on your property, you provide a separate living space for your adult children, offering them independence while still being under the same roof. The affordability of an ADU makes it a practical option for young adults who are seeking to get their feet on the ground. Charging them a minimal and fair rent allows them to save money while benefiting from the convenience and support of living close to home.
How can an ADU provide low-cost housing for senior family members and caretakers?
ADUs, also known as mother-in-law suites, offer an excellent solution for providing affordable housing options to senior family members and caretakers. By constructing an ADU for aging parents or grandparents, you can ensure that they have the additional space they need while remaining close to you. This allows you to actively participate in their daily lives and offer assistance when necessary, all while keeping costs relatively low.
One of the key benefits of building an ADU is the significant cost savings it offers compared to alternative options like assisted living facilities. Assisted living costs can often soar to around $7000 a month, becoming a significant financial burden over time. On the other hand, constructing an ADU typically falls within a range of just 10-20% of that cost. This makes ADUs a much more affordable choice for providing independent living arrangements to senior family members.
By opting for an ADU, you allow senior family members to maintain their independence while still having support and supervision available when needed. This arrangement offers peace of mind, both for the seniors and their caretakers, as they can maintain a sense of autonomy while having the comfort of knowing that assistance is nearby. Adding an ADU to your property allows you to keep a close eye on your loved ones, ensuring their safety and well-being. Additionally, the low-cost housing provided by an ADU is not limited to seniors alone. Caretakers, such as professional caregivers or family members who assist with caregiving responsibilities, can also benefit from this arrangement. Having a separate living space near the primary residence allows caretakers to provide continuous care and support, while still having their own affordable housing option.
One of the key benefits of building an ADU is the significant cost savings it offers compared to alternative options like assisted living facilities. Assisted living costs can often soar to around $7000 a month, becoming a significant financial burden over time. On the other hand, constructing an ADU typically falls within a range of just 10-20% of that cost. This makes ADUs a much more affordable choice for providing independent living arrangements to senior family members.
By opting for an ADU, you allow senior family members to maintain their independence while still having support and supervision available when needed. This arrangement offers peace of mind, both for the seniors and their caretakers, as they can maintain a sense of autonomy while having the comfort of knowing that assistance is nearby. Adding an ADU to your property allows you to keep a close eye on your loved ones, ensuring their safety and well-being. Additionally, the low-cost housing provided by an ADU is not limited to seniors alone. Caretakers, such as professional caregivers or family members who assist with caregiving responsibilities, can also benefit from this arrangement. Having a separate living space near the primary residence allows caretakers to provide continuous care and support, while still having their own affordable housing option.
How does an ADU increase property value?
Building an accessory dwelling unit (ADU) is a popular way to boost the value of your property. It offers several advantages that potential homeowners appreciate, leading them to be willing to pay more for properties with ADUs attached. ADUs provide increased flexibility, allowing homeowners to use the space for various purposes such as accommodating extended family members, renting it out for extra income, or using it as a home office or studio. This versatility appeals to a wide range of buyers, expanding the potential market for your property.
Moreover, ADUs offer additional privacy for both the homeowner and potential tenants. Having a separate living space provides a sense of independence and separation from the main house, which many individuals desire. This privacy can be particularly appealing to tenants who may value having their own space without compromising on convenience or location.
In addition, ADUs offer the potential for lower monthly living expenses. By having an additional dwelling unit on the property, homeowners can benefit from the rental income generated by renting out the ADU. This extra income can help offset mortgage payments or other expenses, making the property more attractive to potential buyers.
Furthermore, building an ADU is often a more cost-effective option compared to other methods of increasing property value. Instead of investing in extensive renovations or expansions, converting an existing space such as a garage or building a separate structure can be a more affordable and efficient way to add value to your property. Overall, ADUs enhance the value of a property by providing increased flexibility, privacy, potential rental income, and cost-effectiveness. These benefits attract a larger pool of potential buyers and make properties with ADUs attached more desirable in the real estate market.
Moreover, ADUs offer additional privacy for both the homeowner and potential tenants. Having a separate living space provides a sense of independence and separation from the main house, which many individuals desire. This privacy can be particularly appealing to tenants who may value having their own space without compromising on convenience or location.
In addition, ADUs offer the potential for lower monthly living expenses. By having an additional dwelling unit on the property, homeowners can benefit from the rental income generated by renting out the ADU. This extra income can help offset mortgage payments or other expenses, making the property more attractive to potential buyers.
Furthermore, building an ADU is often a more cost-effective option compared to other methods of increasing property value. Instead of investing in extensive renovations or expansions, converting an existing space such as a garage or building a separate structure can be a more affordable and efficient way to add value to your property. Overall, ADUs enhance the value of a property by providing increased flexibility, privacy, potential rental income, and cost-effectiveness. These benefits attract a larger pool of potential buyers and make properties with ADUs attached more desirable in the real estate market.
Custom Smart ADU UNits
Simplify your income with an ADU Unit in your back yard
Having an accessory dwelling unit (ADU) on an existing property has become a popular way for homeowners to offer independent living space to family members or to gain residual income by renting out the unit. This popularity has increased demand for home financing that offers special consideration for an ADU.
Freddie Mac’s ADU policies provide multiple options for adding an ADU to a home or financing a purchase with the intention to rent or build an ADU, including allowing the borrower to use rental income to qualify. Our policies allow you to offer ADU flexibility on any Freddie Mac mortgage, giving your customers more choice in the purchase or renovation financing process.
Freddie Mac’s ADU policies provide multiple options for adding an ADU to a home or financing a purchase with the intention to rent or build an ADU, including allowing the borrower to use rental income to qualify. Our policies allow you to offer ADU flexibility on any Freddie Mac mortgage, giving your customers more choice in the purchase or renovation financing process.
ADU renovation & Set-ups
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An ADU can allow homeowners to offer independent living space to parents, adult children or other family members for less than if they supported a separate living situation.Residual income from renting out an ADU can contribute to mortgage payments and property maintenance to help sustain homeownership.ADUs are usually smaller and more affordable to build than standalone residential properties and have the potential to increase property value in an amount much greater than their cost.ADUs typically have a smaller environmental footprint—they require fewer materials to build and less energy to heat and cool, and they conserve land since they’re built on a lot with an existing property.