Accessory Dwelling Unit – Definition

Cite this article as:"Accessory Dwelling Unit – Definition," in The Business Professor, updated September 18, 2019, last accessed May 27, 2020, https://thebusinessprofessor.com/lesson/accessory-dwelling-unit-definition/.

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Accessory Dwelling Unit (ADU)

An apartment or a house that occupies the same lot with a larger house is called an Accessory Dwelling Unit (ADU). ADU is a legal term in real estate that describes a secondary house that shares the same building lot with a larger house, usually called the primary house.

An independent but smaller residential apartment that is built in the same lot as a larger house or family house is an accessory dwelling unit. It can also be called some other names such as granny flats, secondary suites, among others.

A Little More on What is an Accessory Dwelling Unit (ADU)

When a stand-alone or detached building is constructed on a lot and another secondary apartment is built in that same lot, the secondary apartment is the ADU. ADU is otherwise referred to as carriage house, grant flat, in-law unit and secondary dwelling unit.

An accessory dwelling unit is often attached to the main (primary) apartment, but it can also be constructed as a stand-alone. This apartment has all necessary rooms such as kitchen, living room and bedroom. It has had its entrance separate from that of the primary apartment.

In the United States, zoning laws exist and serve as regulations on how ADUs should be constructed, stating their size and style.

People build accessory dwelling units for different reasons. While some build it as a source of income, some build it to cater for family members. For whichever reason an ADU is constructed, it has pros and cons. They include the following;

  • Accessory dwelling units are regulated by zoning laws. There is a limit to their style and size.
  • These apartments attract upfront costs, housing costs and maintenance costs.
  • Some ADUs are liable to taxation, especially those serving as a means of rental income. Constructing ADU can also cause a huge tax bill.

While some ADUs are legal, some are illegal, illegal ADUs can cause problems for the owner and even the investor. Building an ADU without permission from the zonal agency can attract certain penalties.

Reference for “Accessory Dwelling Unit (ADU)”

https://www.investopedia.com › Investing › Real Estate

https://accessorydwellings.org/what-adus-are-and-why-people-build-them/

www.buildinganadu.com/what-is-an-adu

https://www.planning.org/knowledgebase/accessorydwellings/

https://www.huduser.gov/portal/publications/adu.pdf

Academics research on “Accessory Dwelling Unit (ADU)”

Zoning, accessory dwelling units, and family caregiving: Issues, trends, and recommendations, Liebig, P. S., Koenig, T., & Pynoos, J. (2006). Journal of aging & social policy, 18(3-4), 155-172. The connection between zoning regulations and co-residential family caregiving in the United States is explored in this article. Firstly, an overview of U.S. housing policies like zoning is provided. We describe the significant variations in family composition and structures in the United States and how they affect caregiving. We also discuss family caregiving support provided by multigenerational housing options like the accessory dwelling units(ADUs) in single-family units. The study documents current trends, add information from a minute non-random study of ADU project carried out in 2004. Recommendations for enhancing more multigenerational housing are provided.

Housing changing households: Regulatory challenges for micro-units and accessory dwelling units, Infranca, J. (2014). Stan. L. & Pol’y Rev., 25, 53. There has been a reduction in the sizes of household with more people isolated in recent times. Notwithstanding, people are experiencing longevity with a significant rise in the number of multigenerational households which were popular in the previous generation. Available housing units and the city’s evolving households units remain in a state of disequilibrium.

Understanding and Appraising Properties with Accessory Dwelling Units., John Brown, M., & Watkins, T. (2012). Appraisal Journal, 80(4). Some municipalities for social and environmental factors enhance Accessory dwelling units(ADUs). Nevertheless, complications could arise from appraising of properties, as well as, lending on them that feature ADUs. This complication is facilitated by undervaluing of these properties and some other institutional frameworks. Provision on primer on ADUs and evaluation on an income-based method to valuation was provided by this article.  An income capitalization method was adopted to show correlations between valuations and actual; sale prices; and the contribution of ADUS on a property appraised value given the formula adopted. An income-based valuation can enhance the insight of the appraisal.

The flex-nest: The accessory dwelling unit as adaptable housing for the life span, Nichols, J. L., & Adams, E. (2013). Interiors, 4(1), 31-52. There have been changes in American families in the past six decades, while the single-family home housing them has hardly experienced changes. Indication from statistics shows a reduction in household numbers in the past decades, while house sizes have experienced significant enlargement. Slight variations exist in housing types, while building firms and clients support the private single-family home as the emblem of American success. The pressure from an overburdening recession on American housing has been profound. The collapse in the market has masterminded a lot of foreclosures and vacant single-family homes while facilitating scarcity concurrently in the rental market.

Grandparents and Accessory Dwelling Units: Preserving Intimacy and Independence, Brinig, M. F. (2014). Elder LJ, 22, 381. ADU has the potentialities to solve a lot of social problems as it helps elders to live at homes while having a close relationship with their children. Professor Margaret Brinig looks at the potentialities of an accessory dwelling unit as a zoning device from both a legal and public policy angle.

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