The Top 5 Ways to Add a Second Unit to Your Home

With real estate prices skyrocketing across the U.S., many people are exploring alternate solutions, like adding living space to property that they already own. Accessory dwelling units (ADUs) are among the most cost-effective and space-efficient solutions.

If there is only one thing you take away from this article, it should be this - ADUs give you options.

Adding a second unit to your property gives you flexibility with your property - from having an extra guest bedroom, to housing elder family members, to earning new rental income. It’s your space and you have the freedom to do whatever you want with it. Not to mention that when you’re ready to sell the home, your home value will be significantly higher thanks to the ADU. Some ways of adding a second unit are more popular than others. Below are five strategies to build a new ADU or convert your property's existing space into one.

Backyard Homes

As the name suggests, backyard homes are small homes suitable for independent living. While their features vary, they usually provide all the essentials, such as a full kitchen, bathroom, bedroom, and living space.

Backyard homes are a particularly good solution for aging parents who want to live closer to their children while still maintaining some independence. Since these units usually have just a single floor, they are naturally more accessible than some ADUs that might be two stories, and require climbing stairs. Less complicated projects usually lead to lower initial investment costs, and more seamless permitting processes.

Garage Conversion

A particularly quick and cost-effective ADU solution, the garage conversion does not usually require much construction work, as the walls (and possibly even electricity and plumbing) will already be in place. Since garages are at street level, they offer the same accessibility benefits as backyard homes, and do not require parking. Thanks to 2020 legislation, they also do not need to replace the parking that is required for the primary home.

Every home and residential area is different, and it pays to carefully research how much a garage conversion will cost, as well as how it will affect the value of your home. While most garage conversions are simple, they can require significant renovation if the original structure is less than sound. In addition, garages have more value in neighborhoods with limited street parking, in which case garage conversion carries some risk of reducing the value of your home. Make sure to determine alternative parking solutions and understand how a garage conversion will affect your property value before you move forward.

Attached Additional Unit

An attached additional unit is an add-on—functionally separate, but still physically attached to an existing home. Since this requires new construction, it's one of the more expensive ADU solutions, especially when compared to conversion projects. With that said, building an attached additional unit from scratch gives you more control over the design and construction. Instead of having to make the best of the structures you already have, this lets you plan carefully from the very beginning so that the new unit perfectly matches your needs.

Basement Conversion

A basement conversion is usually the ADU solution that requires the least physical transformation of your home. Your basement is located near the main living areas of your house and can easily access amenities like plumbing and electricity systems.

As usual, the amount of work required for a basement conversion depends upon your home’s configuration. While turning an existing basement into a living space merely requires cosmetic renovations and possibly an extension, creating a new basement from scratch is one of the more expensive ADU options.

Accessory Structure Conversion

Accessory structure conversion sees the transformation of an attached or detached structure, like a storage shed or a greenhouse, into a living space. This process usually requires installing cooking and bathing facilities, complete with electrical and gas supply. For this reason it's usually more expensive than garage or basement conversion, but less expensive than constructing an additional unit from scratch.


Arguably the biggest decision is whether to build a new unit from scratch or to convert an existing structure. Everyone's situation is unique, and the right choice depends on your circumstances and needs.

If you're ready to take the next step towards adding an ADU to your home, consider using the Housable free property check. You can take advantage of our range of ADU services to get your designs ready for the city permitting and construction process. Meanwhile, our ADU Marketplace gives you access to our local contractor database, which you can use to get on-site visits and cost estimates for your ADU project.

We look forward to working with you to help you get started with your ADU project.