Accessory dwelling units, also known as casitas in the Phoenix metro area, are in the news because they have been “legalized” in Arizona in an effort to ease the housing affordability and inventory crisis. ADU construction has been on the rise since the pandemic, growing at a rate of 9% or 100,000 units per year. Besides filling a need, ADUs may add value when you sell your home. A study by Porch.com says homes with an ADU are priced 35% higher, on average, than a home without one. However, “priced”, or the number a home is listed at, is not the same as what it sold for. Sure, adding square footage adds value. But building one is pricey. The average cost of an ADU nationwide is $180,000, according to Porch.com – although my experience is that they cost over $200,000 here. Like all real estate, the area, quality of construction, amenities, and size of the ADU will largely determine the value it adds. I wouldn’t be surprised, depending on these factors, if some sellers only break even.
