The Santa Clara County ADU Calculator is a great place to start when developing a budget. It provides a rough estimate of costs and income and will help you understand how choices can impact your budget over time. In general, it is helpful to avoid having a fixed budget total in your head as you explore your options.The cost to build an ADU typically ranges from $30,000 for a simple interior conversion JADU, to $400,000+ for a large detached ADU with high-end finishes on a hillside lot. Cost per square foot is a good way to estimate, though this too can vary — a very rough placeholder for you to use is $400-550 per square foot for construction (“hard costs”) and design and fees (“soft costs”), depending on your design and the materials you chose.

See more details about costs – including design, permitting, and construction – in our ADU Guidebook.

Many homeowners use a mix of options to finance their ADU, including savings, funds from family, and/or loans. It is strongly recommended that your financing is in place before construction starts. Be sure to factor in potential rental income since that will help you repay loans. See our Guidebook and Exercises for more details on financing options.

If you have equity in your home, a cash-out refinance or home equity loan/line of credit (HELOC) might work for you. Financing is typically unavailable for homeowners with lower income and insufficient home equity, but as of January 2023, the California Housing Finance Agency (Cal HFA) ADU Program provides a grant of up to $40,000 to qualified homeowners for the reimbursement of ADU pre-development costs, including but not limited to impact fees. To qualify, a homeowner must be low or moderate income. Make sure to check if funds are available and if you qualify.

Adding an ADU will likely affect your property taxes and the resale value of your home. However, your primary house will not be reassessed, and your property taxes will only increase based on the added value of your ADU. For example, if you build an ADU that adds $150,000 to your property value, and your tax rate is 1%, your taxes will increase by 1% x $150,000, or $1,500 per year.

Building a JADU will have a significantly smaller impact on assessed value. In some cases, your taxes will not increase at all. Home sharing will also not increase the assessed value of your home. Generally, garage conversions will not raise your tax bill as much as new construction, but they will also not add as much value.

Each property will require a one-on-one analysis to determine the added value of an ADU, so contact the Santa Clara County Assessor’s Office once you have an idea of your plan. They may be able to provide you with a rough estimate of tax implications.

Adding an ADU may impact your income taxes as well. This can be rather complicated, and it’s best to discuss these with a tax advisor.

Generally no. You may need to record in a deed restriction for the property that the ADU cannot be sold separately from the primary home. Check Local ADU Rules and contact your City to find out what local restrictions apply.

Rental income is a major benefit of having an ADU or JADU on your property – for many people, it provides flexibility in their budget or an opportunity to grow their savings. Generally, you cannot rent your ADU for less than 30 days at a time (e.g., AirBnB, Vrbo). The Santa Clara County ADU Calculator can help you estimate how much rental income could be generated by your new unit.