Accessory dwelling units — ADUs, granny flats, backyard cottages, garage conversions — are having a moment. Most states have passed legislation making them easier to permit. Homeowners see them as rental income, multigenerational living solutions, or simply a way to add value to their property.
They're also one of the most misunderstood residential project types we encounter. Clients come in with an idea of what an ADU is, and often a very different idea of what it costs and how long it takes. Here's what you actually need to know.
What Counts as an ADU
An ADU is a self-contained residential unit on the same lot as a primary dwelling. Self-contained means it has its own kitchen (or kitchenette), bathroom, and living space. It can be attached to the main house, detached, or a conversion of an existing structure like a garage.
A guest room with a bathroom is not an ADU. A detached studio without a kitchen is typically not an ADU. The distinction matters because ADUs have specific code requirements — and specific permit requirements — that don't apply to simple additions.
The Permitting Reality
State ADU legislation has made permitting easier in many markets, but "easier" is relative. You still need permits. You still need drawings. In most jurisdictions, you still need structural engineering if you're doing anything involving foundations, framing modifications, or load-bearing changes.
Garage conversions are the most commonly underestimated category. Converting a garage to a living space requires: architectural drawings showing the conversion, often structural drawings if the garage slab needs to be thickened or the roof framing modified, mechanical/electrical/plumbing permits, and in some jurisdictions, a separate utility connection or subpanel.
The permit fee alone is often $2,000–$5,000. Factor this into your budget from the beginning.
Cost Ranges
Design and engineering for an ADU typically runs $4,000–$8,000 for a standard permit-ready package. Construction costs vary significantly by market, type, and finish level. According to 2026 data from Angi and HomeGuide, national ranges look like this:
Garage conversion: $80,000–$150,000, depending on finish level and mechanical complexity — the most cost-effective option since the foundation, walls, and roof already exist.
New detached ADU (400–800 SF): $150,000–$300,000+ in most markets, with high-cost metros like Los Angeles running $350–$550 per square foot.
Attached ADU or basement conversion: $150,000–$300,000 depending on scope.
These are planning ranges, not quotes. The actual cost depends on your jurisdiction, site conditions, and finish selections. Get three contractor bids before committing to a budget.
Timeline
Permit-ready drawings: 4–6 weeks for a straightforward ADU. Permit issuance: 4–12 weeks depending on the jurisdiction's permit backlog (this is out of your control). Construction: 4–8 months for most projects.
Total from start to occupancy: 9–18 months is a realistic planning horizon. Projects that close faster than this usually involve a jurisdiction with an expedited ADU track and a contractor who was available immediately.
Questions to Ask Before Starting
Is an ADU allowed on my lot? Check your local zoning code. ADUs are permitted in most residential zones now, but setback requirements, lot coverage limits, and owner-occupancy requirements vary.
What utilities does my property have capacity for? Adding a unit means adding load. Your electrical panel may need an upgrade. Your sewer lateral may need to be assessed. A licensed plumber and electrician can answer these questions in a site visit before design begins.
What are my rental income expectations? ADUs pencil out as rental investments in high-cost markets. In lower-cost markets, the math is tighter. Run the numbers before committing to a budget.
The upfront investment in good design and permitting documentation saves more than it costs. An ADU built without permits is a liability that follows the property title indefinitely.