So you’ve decided you want to build an ADU on your property. But where should you begin? While the structure itself is small, ADUs still require planning and permitting—both of which depend on the unique characteristics of your property. In this guest post from architect and Certified ADU Specialist Katherine Pelz, you’ll get an overview of the start-up process and important questions to ask yourself along the way.

Step 1: Define your wants and needs  

The key to a successful ADU build is creating a space that fits not just your current life, but the life you want in the future. Start by writing down a list of the things you want to achieve by adding a unit to your property; then, write down a list of long-term goals. These lists will help you keep your project goals in focus, determine where to spend your money, and help you design the right space for what you need.

Why are you building an ADU?

Some people build ADUs to house loved ones, like a grandparent or parent who needs their own space. This scenario might look entirely different than a unit built to rent out. For example, you may want to build a ground floor unit with no stairs for a parent or grandparent; however, you might prefer to build a larger unit with more space between your home and the unit if you intend to rent it out. If you convert a garage by building a unit on top of the garage, it must be for folks who don’t mind walking up a flight of stairs to bring groceries up, and who don’t mind the homeowner working inside or moving in and out of a garage by car.

You’ll also want to consider things like utilities—cable and wifi could be individualized, or you could consider sound or fire separation as well as metering each utility separately so that each tenant pays directly for what they use (sometimes building codes will impose this decision for you). 

AADU kitchen in basement of home, Katherine Pelz Architecture. Photo courtesy of Katherine Pelz Architecture.
AADU kitchen in basement of home, Katherine Pelz Architecture. Photo courtesy of Katherine Pelz Architecture.

Step 2: Decide which type of living space you want—AADU or DADU  

There are two types of structures within the ADU umbrella: attached ADU (AADU) and detached ADU (DADU). An AADU is a separate living space within a property’s primary structure (like a basement apartment or in-law suite), while a DADU is a secondary structure separate from the main home (a guest house above a detached garage or a backyard cottage, for example).

How much privacy do you want?

Designing and creating a new AADU can be quite different than building a new DADU structure. Each homeowner will need to decide if they want to share space with another person before designing an AADU, whereas a DADU can allow for more privacy and independence. You can also consider adding on to an existing garage—think converting, renovating, or building above. 

What will your property allow for?

Attached units can be made from an existing space within your house relatively easily if the ceiling height is high enough and common areas are available for shared things. Sometimes folks want to share laundry rooms and mechanical control spaces. If you want a basement unit but your ceilings aren't high enough, you could consider a house lift as an option.

For DADUs, adding a space off of a house can require all new construction in a new spot on the property. Make sure you have the space on your lot so as not to exceed lot coverages. In Seattle, accessory structures may cover 35 percent of the lot on lots 5,000 square feet or greater. On lots less than 5,000 square feet, structures can cover 1,000 square feet plus 15 percent of the lot. 

Any project that adds space onto a house outside its existing footprint or adds a DADU will require a survey to determine where you can legally build new structures and what shape they can be, given the property constraints and existing lot coverage. The surveyor will do a preliminary analysis of the site you are going to develop so you understand the rules that apply to your unique situation: yard setbacks, height limits, easements, and sewer location among others. 

Step 3: Acquire ADU permits 

Sometimes getting a permit to build in certain areas is difficult. However, the City of Seattle has made efforts to streamline the process in an effort to help homeowners build ADUs and save time and money. 

If you are willing to use a pre-permitted building schematic, you will save time in the permit process and money as far as paying an architect to customize plans. There are pros and cons to using pre-permitted plans. If you decide to use a pre-permitted plan from the city, you can’t make any customizations to the plan, unless you re-permit it. 

Plans cost around $1,000 to license and give you the option of working with the architect that designed the plan. This price does not include the cost of the permits, which can vary depending on the value of the work. For a 1,000-square-foot pre-approved plan, permits cost around $3,400. (Check out the city's online fee estimator to determine permit costs.) You can use these online resources to view pre-permitted plans and see if your site allows a DADU or AADU. Building permit applications should be submitted to the Seattle Department of Construction and Inspections (SDCI)

Getting a permit for a DADU from a pre-permitted plan is much easier to get (cheaper and faster, as long as you don’t make changes to it) than a custom-built DADU, which is best done with an experienced architect who understands how to navigate the city codes and complexity of construction. 

DADU pre-permitted plan, Urban Cottage Prefab. Photo courtesy of Eileen Behrens.
DADU pre-permitted plan, Urban Cottage Prefab. Photo courtesy of Eileen Behrens.
DADU pre-permitted plan, Urban Cottage Prefab. Photo courtesy of Eileen Behrens.
DADU pre-permitted plan, Urban Cottage Prefab. Photo courtesy of Eileen Behrens.

Step 4: Get your finances in order  

If you have a strict budget, it’s even more important to spend time on this step and do it right—and early on. If your budget is flexible, you may not need to identify the specifics before starting the design. 

The scope of the project (meaning the physical components of the project) will align with a cost—if you do more the cost goes up, if you do less the cost goes down. Whatever your budget, do not try to “get a deal” or attempt a project larger than your budget allows. These two approaches will almost always result in a lack of quality. Be realistic about what you need and what you are willing to spend. 

Can you get a home loan, and how?  

If you qualify, it is absolutely possible to get a home loan for an ADU project. 

Talk to your banker, mortgage officer, or realtor about your options given your financial situation. (Be sure to bring income verification, proof of assets, a list of liabilities, two previous years' tax returns, and a home appraisal.) If you have enough equity in your home, you may be able to get a cash-out refinance. To go this route, you typically need to get your home appraised and compare that number to the projected value of your home with the ADU. For this estimate, bankers look at comparable projects within a one-mile radius of your home.  

You might also want to check with your insurance company to see if they offer a “course of construction” insurance policy. This covers things like vandalism and trespassing (unless you are using a contractor who has these kinds of coverages). Another option would be to get a HELOC (home equity line of credit). 

You need the permit for your project before the loan can close—and you should never break ground before closing.

Step 5: Set your construction budget 

Keeping the budget under control requires understanding a combination of factors. Making a new unit that has a lot of nuanced finishes and idiosyncratic taste will cost more than a very basic rectangular space with only the essentials. A good way to think about it is in terms of building codes: Are you simply looking to build a liveable space that’s up to code, or do you want to emphasize elements of the design like windows, doors, and finishes?

Making decisions on products and where you want to put your money requires research, as well as communication. The team must decide about the quality of products, and which areas of the remodel are most important. It can help to make a priority list and organize it hierarchically. This list can be used as a guide as you move through the project and will allow you to reflect on where to focus time and money. 

Consult your list of long-term goals from step one and think about how you might be able to maximize your development potential. For example, if your ADU requires a new sewer line, think about whether you might want to extend that line to another part of your home in case you (or a future homeowner) want to add another bathroom. Maximizing construction in this respect will save you money down the road.

How much should you spend?

Homeowners who embark on this kind of project must understand that the amount of customization to the unit greatly influences project budget and outcome. I’ve done ADUs that cost from $100,000 (a space that, with a few changes, became a turn-key unit) to $600,000 (a custom DADU fit to a very fine degree of design and detail). 

A preliminary design can help a contractor quote a ballpark cost, but final materials and details can be value-engineered to align with your budget. Only when you and your contractor understand the scope and desired quality of the finished product can they realistically predict construction cost. 

Custom-designed DADU, Katherine Pelz Architecture. Photo courtesy of Lou Cuevas Photography.
Custom-designed DADU, Katherine Pelz Architecture. Photo courtesy of Lou Cuevas Photography.

Step 6: Determine if you need an architect 

Deciding upfront whether your unit will be basic or high-end can help you determine whether or not to use an architect. There are many decisions to be made in building an AADU or DADU and making it clear who will make those decisions—the homeowner, the architect, or the contractor—will help you delegate tasks appropriately and set the tone of the building process. Architects may be important if you want customization and unique features.

You’ll also want to think about how involved you want to (or are able to) be. If, as the homeowner, you want to be heavily involved in the building process, then it’ll be important to clear your schedule to allow enough time to make decisions quickly if necessary. If you’d rather not be involved in all the small details, consider hiring an architect you trust who can manage the process.

With any project, it's always important to consult a trusted expert before getting started, even if you don't end up working together throughout the project. ADU Specialists are uniquely positioned to help homeowners and developers understand site eligibility, local regulations, development process and costs, and the return on investment.

This is the second article in our ADU series; to read the first article, check out this ADU overview.