Are Luxury ADUs the House Hack This Tight Economy Needs?

Photo courtesy of Makara ADUs via Houzz

Who would want to live in a tiny home in their parents’ backyard? As it turns out, a lot of people—including Lena Dunham.

The writer, director, and millennial antihero recently opened the doors of her newly built 1.5-bedroom forever home to Architectural Digest. The twist? It’s situated 10 feet behind her parents’ house in Connecticut.

For the uninitiated, Dunham is a married 36-year-old woman who created HBO’s “Girls,” one of the most successful TV shows of her generation. She has made the Time 100 list of most influential people in the world and considers Taylor Swift a close personal friend. She could presumably live just about anywhere, but she opted to move into an accessory dwelling unit on her parents’ New England compound.

With distinctive design and sumptuous details just a stone’s throw away from Mom and Dad’s lasagna, laundry services, and warm hugs, it’s easy to see why someone like Dunham would love to live here. But what about the rest of us?

For young would-be homebuyers who don’t mind sharing a yard with their family, is designing and living in an ADU the next hot housing trend? And—perhaps more timely—is multigenerational living a solution to the current real estate affordability problem?

Inside Lena Dunham’s luxury accessory dwelling unit

Known as “The Carriage House,” Dunham’s new pad is the furthest thing from a hastily constructed tiny home: It’s a luxury ADU dripping with designer touches.

According to Dunham, the two-story structure is “a density of color and texture: parrots and turquoise-backed flowers in the primary bedroom; wood-grain wallpaper in the office nook; a built-in, cozy domain upholstered with Jessica McClintock–esque ’80s roses with a sliding pink door to close it off, nicknamed The Slot.”

There’s original art by Jackie Saccoccio and Marilyn Minter as well as aesthetically pleasing furniture, including a Vladimir Kagan sofa and vintage Ward Bennett club chairs.

The home was also custom-designed for Dunham’s well-documented health challenges.

“The low staircase is perfect for the days my arthritic hips give me trouble, with a custom carved banister that is rounded like the corners of a marshmallow, and the bathtub has a pull-up bar in case I get dizzy,” Dunham wrote in Architectural Digest.

The rise of ADUs for ‘normal’ people

Few of us have Dunham’s budget or access to the kind of architects and designers who could make a pencil box feel roomy and look chic. But the average person can also make an ADU a lovely space to be.

“You definitely don’t need to be rich to build and design a luxury ADU,” says Ryan Fitzgerald, owner of UpHomes in Charlotte, NC.

You just need to approach the ADU as you would a regular home, just on a smaller scale, he explains.

In other words: Choose the best materials, craftsmanship, and design that you can reasonably afford.

In many ways, the rise of ADUs is a win for both younger people in need of an affordable home—and their parents.

“The skyrocketing cost of housing has sparked a national housing crisis,” says Kerry Sherin, consumer advocate at Ownerly in Myrtle Beach, SC. “Rents are rising, so millennials are looking for long-term and affordable housing. ADUs can be a better investment than renting—and an investment that appreciates, not just in value, but in long-term utility.

“For both parents and their millennial children, there’s no reason not to consider adding an ADU to their property,” says Sherin.

Where are ADUs being built, and what does it entail?

ADUs are on the rise everywhere, but more than half of the estimated 1.4 million ADUs in the U.S. are in California, Florida, Texas, and Georgia, according to Freddie Mac. The metro areas with double-digit ADU growth include Seattle, Los Angeles, and Miami.

Rules vary from state to state and town to town, but you will definitely need a permit before you can begin construction.

“ADUs may be subject to specific rules in your city or county, such as height restrictions. You will need to show detailed plans drawn to scale for your project,” says Sherin. “An architect or ADU designer may be able to help you figure out what permits you need and prepare your application. Depending on your jurisdiction, you may also need electrical, plumbing, and mechanical permits.”

Size rules will vary. too. In California, the minimum space requirement is 150 feet, and the average cost to construct one is $150,000, or $250 per square foot, according to a report from the Terner Center for Housing Innovation at the University of California, Berkeley.

“ADUs can cost anywhere up to $400,000,” says Sherin. “The cost depends on the area where you live and the size of the ADU you want. ADU construction costs can reach $350,000 to $390,000 in the San Francisco Bay Area.”

When it comes to the cost of interior design, it’s going to depend on the materials. If you’re going the way of Dunham and building your dream home, it may be worthwhile to invest in high-quality appliances and furnishings.

ADU in spirit, if not in fact

If zoning restrictions or the realities of your property’s layout prevent the construction of an ADU, there are still plenty of options.

“With current housing market conditions, we will see more and more multigenerational living,” says Denise Supplee, a licensed real estate agent in Philadelphia and the founder of SparkRental.com. “I have already been seeing it in my market area of Philadelphia and the suburbs.”

However, Supplee acknowledges that adding or converting a building on a property to be used as a separate living quarter can be tricky in any area, especially urban and suburban neighborhoods.

In situations like that, where there is still a need for a separate living space, Supplee suggests converting a basement or garage, where having a different entry is still possible.

The post Are Luxury ADUs the House Hack This Tight Economy Needs? appeared first on Real Estate News & Insights | realtor.com®.