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AP National Business

Liz Weston: Will adding an accessory dwelling unit pay off?

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Published 5:00 AM

By LIZ WESTON of NerdWallet

Accessory dwelling units, or ADUs, are separate living spaces added to an existing home — typically on a single-family residential lot. That addition could include a converted basement or backyard cottage. ADUs can house older family members, provide lodging for young adult family members or serve as a source of rental income. Despite their utility, ADUs aren’t allowed in many areas. Even where ADUs are legal, construction costs and higher property taxes can make them a costly investment. Before you build an ADU, weigh the pros and cons and look around your city to see what your neighbors are doing.

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