ADU value & ROI calculator
An accessory dwelling unit (ADU) — a granny flat, backyard cottage, or garage conversion — is one of the few additions that can both add home value and generate rental income. Estimate both below.
Directional estimate using typical national cost-vs-value recoup rates and your rent input. Returns vary widely by market, quality, and timing — not an appraisal.
How much value does an ADU add?
In high-demand and ADU-friendly markets, an accessory dwelling unit often adds roughly its build cost in value — sometimes more — because it creates a fully separate, income-capable living space. The return is highly local: where ADUs are legal and rentals are scarce (much of California and other supply-constrained metros), value-add and rents are strongest. Where zoning is restrictive, both shrink.
The real financial case for an ADU is usually the rental income, which can offset the build cost over time on top of any resale value — use the rent input above to see the payback.
What drives ADU value & income
Legality & permits. A permitted, legal ADU adds value; an unpermitted conversion can be a liability at sale. Check local zoning first.
Type. Garage conversions and basement units are cheaper; detached new-build cottages cost more but often command higher rent and value.
Rental demand. Tight rental markets near jobs, transit, or universities maximize income and value.
Separation & utilities. A private entrance, kitchen, and metered utilities make it a true second unit — worth far more than a bonus room.
When an ADU pays off
Strong case: ADU-legal city, high rents, a convertible garage or large lot, and you’ll rent it or house family.
Weaker case: restrictive zoning, low local rents, or high build costs relative to home value.
Put it in context
Compare this against other projects with the Increase Home Value calculator, check what your home is worth with the Home Value Estimator, and see local prices on the home values map.