The ROI of Building an ADU in Your Backyard

‍If you’ve ever looked at your backyard and thought, “This space could be doing more” you’re not alone. More and more homeowners in Orange County are turning to ADUs (Accessory Dwelling Units) as a way to boost property value, create rental income, or simply gain more usable living space. But is building an ADU actually a good investment?

Let’s break it down in simple terms.

What is an ADU?

An ADU, or Accessory Dwelling Unit, is a secondary living space on your property. It can be a garage conversion, a detached unit, or even an addition built onto your existing home. Think of it as a mini home in your backyard that has its own kitchen, bathroom, and entrance.

Why Are So Many People Building ADUs?

• Rental Income – Renting out your ADU can bring in anywhere from $1,800 to $3,000 per month in Orange County, depending on size and location. That’s a serious return, especially in today’s rental market.
• Property Value Boost – Homes with ADUs often sell for more. Buyers love the flexibility whether it’s for a home office, guest space, or rental opportunity.
• Family Flexibility – Many homeowners build ADUs for aging parents, college kids, or visiting guests. It gives everyone privacy while staying close.

What’s the ROI?

Here’s the truth: The ROI of building an ADU depends on your goals.

• Short-Term Rental (like Airbnb) – You could cover your construction costs in as little as 5 to 7 years.
• Long-Term Rental – Many homeowners see a 15% to 30% increase in overall property value.
• No Rent, Just Value – Even if you don’t rent it out, having an ADU can help your home stand out in the market if you ever decide to sell.

But... Is It Worth the Cost?

In Orange County, the average ADU build can range from $150,000 to $300,000 depending on size, finishes, and design. If done right, that investment pays off.

The key is working with a design-build team that knows the local zoning laws, permit process, and how to build efficiently without cutting corners.

Real-Life Example from Builderwell

One of our recent clients in Irvine added a detached ADU behind their main home. The space now brings in $2,500 per month through long-term rental, and it added over $200,000 in appraised value to their property. That’s the power of smart design and quality construction.

Here’s what our client says about Builderwell:

Ready to Explore the Possibilities?

If you’ve been thinking about expanding your home’s potential, an ADU could be the smartest step you take. It’s not just an addition — it’s an investment in your future.

At Builderwell, we specialize in high-end ADU design and construction across Orange County. Whether you’re just starting to explore the idea or you’re ready to build, we’re here to guide you every step of the way.

Schedule a free consultation today and let’s talk about how an ADU can work for you.