Two Ways to Add Square Footage
Make a strategic decision before calling contractors: traditional home addition or Accessory Dwelling Unit (ADU)? These have fundamentally different costs, timelines, and returns.
Traditional Home Addition
Expands your existing living space — new bedroom, family room, second story. Integrates into your home's floor plan and shares HVAC and utilities.
Cost: $100–$400/sq ft. A 400 sq ft addition runs $60,000–$150,000.
Accessory Dwelling Unit (ADU)
A fully self-contained secondary dwelling — its own kitchen, bathroom, and entrance. Can be detached (backyard cottage), attached, or a garage conversion.
Cost: $90,000–$300,000 detached. Garage conversions: $40,000–$100,000.
Side-by-Side Comparison
- Cost per sq ft: Addition ($100–$400) vs. ADU ($150–$500)
- Timeline: Addition (3–6 months) vs. ADU (6–18 months)
- Rental income: Addition (none) vs. ADU ($1,000–$3,500/month)
- ROI: Addition (50–60%) vs. ADU (60–80% in high-cost markets)
The Financial Math on ADUs
ADU renting for $2,000/month on a $150,000 build = 16% gross yield, ~10–12% cash-on-cash return after expenses. Better than most financial instruments.
Use our Home Addition Cost Calculator for a local estimate.
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