An agent at Antenna Realty
Los Angeles · (555) 555-0100
An agent at Antenna Realty
Los Angeles · (555) 555-0100
In an expensive market, the most credible lever is an income unit. See whether a rental ADU pays for its own construction and what it does to your real monthly cost.
A concept model. Move the sliders to see whether a rental ADU pencils out on the home you have in mind, and how much it lowers your real monthly cost.
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Assumes property tax 1.25%, insurance 0.35%, maintenance 1% of value per year on the main home. ADU build financed at the construction-loan rate over the chosen term. A concept estimate, not a quote, appraisal, or financial advice.
An ADU is a real lever only when all three of these clear at once. Numbers shift block to block. Treat this as a starting point, then talk to an agent and a builder who know the neighborhood.
The model compares two monthly numbers: the cost of carrying the main home alone, versus the cost of carrying the main home plus an ADU minus the net rent that ADU generates. When net rent (rent minus vacancy and upkeep) covers the construction-loan payment, the ADU pays for itself. Anything beyond that lowers the real monthly cost on the main home.
Property tax 1.25%, insurance 0.35%, and maintenance 1% of value per year on the main home. ADU build cost is financed at the chosen construction-loan rate over the chosen term (typically 30 years for stabilized financing). Concept estimates only; permits, timeline, lot fit, and zoning are not modeled.
Net ADU rent (rent minus a vacancy and upkeep allowance, typically 12%) is greater than or equal to the construction-loan payment for the build. At that point the unit is self-sustaining and any additional rent reduces the main-home monthly cost.
A 600-to-900-square-foot ADU typically runs $180K to $300K all-in, depending on site conditions, finishes, and whether it's a conversion, attached addition, or detached build.
A well-built one-bedroom ADU on the Westside typically rents in the $2,200 to $3,400/month range; coastal pockets and design-led builds reach $3,800+. Inland pockets land closer to $1,800 to $2,400.
LA ADU timelines run 12 to 18 months from concept to occupancy, with the permitting and design phase typically 4 to 6 of those months. Plan for the carry cost during the build window.
The model uses stabilized long-term financing (cash-out refi or HELOC at amortized terms) as a planning baseline. Short-term construction loans typically refinance into 30-year financing once the ADU is complete and producing rent.
A Collective agent can pressure-test the build cost, the rent comps, and the zoning on the home you have in mind. Free, no pressure.