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Granny flats, tiny homes and ADUs: The essential guide
by Kendyl Young September 19, 2023 SHARE
ADUs, or accessory dwelling units, are the hot topic in real estate, but what are they worth?
Illustrative story: A homebuyer recently commented that he had “overpaid” by $100,000 for a home that had a tiny home in the backyard. Did he? It depends on what he meant by “tiny home”, what features it included, how he’s allowed to use it and how he subsequently chooses to use it.
A tiny home is different from an ADU, but the terms are often used interchangeably. It is reasonable to assume the homebuyer discovered something about the tiny after the close of escrow. Perhaps it was a limit on how he could use the structure or how it was treated in the appraisal.
Our buyers and sellers ask about ADUs all the time. We need to give accurate and responsible answers or we risk losing a client’s trust and future referrals. The good news? As a very welcome side benefit, understanding the rules and potential of ADUs can create a whole new pool of future clients for your business.