Budgeting & pricing your ADU
Garage conversion ADU on Neilson in Berkeley, CA
Varying information abounds online about the cost to build an Accessory Dwelling Unit. The costs cited for prefabricated or one-stop ADU services are at times substantially lower than the true costs and are rarely, if ever, achieved. Also, plans that are marketed as “approved” means the plans were submitted for another project and were approved for that project. There are some cost savings because you are not starting from scratch, however, there is cost involved in making the design work for you and your property, and you still have to go through the building permit application process.
The median ADU construction cost as of Spring 2023 is about $400 - $600 per square foot. Part of the problem with some cost estimates is that the question of “cost” is being answered too simplistically. I’ve therefore created three approaches as a starting point for the construction cost discussion. Most often you will see “construction” costs cited. We recommend adding another 15-20% for design, consultant and permit fees if you are having your ADU custom designed. Even if you are not, having that cushion to cover costs not included in the prefab cost estimate or “pre-approved” plan cost is the smart way to approach budgeting for your ADU. For comparison purposes, each of these approaches assumes a flat lot and a one bedroom, one bathroom 600 square fee unit:
The Economy Model (and the Economy Plus Model)
The Economy Model ADU is built with the most economical materials and systems available but not at the expense of durability. This model should be an attractive and highly functional home. Using off the shelf, economical materials and finishes, the Economy Model will mostly be a traditional look with sloped roofs, standard sized windows and doors.
Type of builder: Economical
Construction cost: $300-$350 per sq.ft.; $150,000 to $180,000
The upgraded features of the Economy Plus Model add about $50 per square foot, or a construction cost of $180,000 to $210,000.
The Standard Model (and the Standard Plus Model)
When more refinement is desired, this ADU is built with economical materials and systems and with more elevated finishes and materials. These units use off the shelf materials and systems and typically still have a more traditional looking exterior with sloped roofs, and mostly traditional windows and doors. The Standard Model should be beautiful and function flawlessly.
Type of builder: Economical
Construction cost: $400-$500 per sq.ft.; $240,000 to $300,000
The added features of the Plus Model add about $50-$75 per square foot and costs between $270,000 - $345,000 to construct.
The High-End Model
The High-End Model delivers quality, appearance, and performance and typically has contemporary styling, often employing flat roofs or sloped metal roofs. It is built by a higher cost builder familiar with the finer detailing at $500-$1,000 per square foot. The High-End Model looks, feels, and operates with grace and beauty.
Type of builder: Higher cost
Construction cost: $600-$1,000 per square foot; $360,000 to $540,000
Regardless of which approach your budget supports, remember that ADU’s are small homes. They require drawings created by an architect that provide the details required to meet all local and state codes and regulations, and the services of a structural engineer as well as an energy consultant to fill out the complex energy code compliance documents. They also require fees from the city or county approving your plans. These non-construction costs or soft costs run typically between 12-16% of the construction costs of the project.
Want more details on these different approaches? With over 30 years of experience, our over 300 projects include many works that have received wide acclaim for excellence in design. I invite you to contact us with any project that you may be considering.
