Our mission is to reduce the cost to build an ADU. However, there are some real challenges to this mission, such as a hot construction market, which has driven up the cost of labor and materials. Fortunately, our ADU models provide our building team with predictable layouts and details resulting in better cost control than fully custom ADUs.
ADU Return on Investment
Los Angeles is an extremely viable market for ADUs. It pays to build an ADU in your backyard because:
We ran a detailed financial projection on building, financing and renting out our 2 Bedroom, 1.5 Bath, 2-Story, ADU Alpha Model in West Los Angeles and the returns are very promising.
Here is a link to download the full financial projection.
The projected rent for the 1,019 sq. ft. unit is $4,354/month
The all-in cost to build this (fully loaded) ADU is projected at $361,358, which sounds like a lot, but when financed at 90% Loan to Cost, creates a monthly payment of $2,231.
So, after the projected monthly loan payment, increase in property taxes and insurance, plus a few other expenses, the anticipated net return is $1,622/month or almost $20,000 per year! A nice bit of cash for letting go of part of your backyard.
Modative works as your one-stop-shop for ADUs, but, it is important to understand what our services, and associated costs include and what they exclude.
If this sounds interesting and you think you have a viable property, please click link below to get started.