Custom ADUs for Los Angeles Homeowners
Turn Your Backyard Into Income While Increasing Property Value
Build a custom ADU that works for you—generate $1,200–$4,000/month in rental income, increase your property value by 20–35%, or create flexible living space for multigenerational family. Design, permitting, and construction handled end-to-end by licensed architects and experienced builders. We navigate LA County regulations, accelerate approvals, and deliver move-in ready homes. Free consultation to explore your ADU potential.
Four Key Benefits
1
Increase Property Value
BENEFIT 1: Increase Property Value 20–35% (While You Live There)
Your backyard is hidden equity. An ADU transforms unused land into a tangible asset that increases your home's value immediately—not someday, now.
In Los Angeles, a quality ADU adds 20–35% to your property value. The math: Your $800K home becomes $960K–$1M with a $200K ADU investment. Before collecting a single rent payment, you've gained $160K–$240K in equity.
When you sell, buyers pay premium prices for multi-unit properties. Your investment recoups 100%+ through immediate equity plus years of rental income.
Why Coast Builders Group wins: We design ADUs that tenants and future buyers love. Quality finishes and smart layouts command premium rental rates today and premium resale value tomorrow. A poorly designed ADU recoups 60% of costs. Ours recoup 100%+.
2
Generate Consistent Rental Income
BENEFIT 2: Generate $1,500–$4,000/Month in Passive Rental Income
ADUs in Los Angeles rent for $1,500–$4,000/month depending on size, finishes, and location. A modest one-bedroom ADU rents for $1,500–$2,200. A premium two-bedroom with high-end finishes commands $2,500–$4,000+. Occupancy rates exceed 95%—your ADU sits empty maybe 1–2 months yearly.
The math: $2,500/month × 12 months = $30,000/year gross. Minus maintenance and insurance: $24,000–$27,000/year net. Your $200K ADU pays for itself in 7–8 years through rental income alone. Add property value appreciation, and it's essentially free.
Whether you need retirement income, help aging parents, or pay down debt—an ADU generates reliable revenue while you sleep.
Why Coast Builders Group wins: Beautiful, well-designed ADUs rent for $800–$1,200/month more than poorly built ones. That's $9,600–$14,400/year extra = $96,000–$144,000 over 10 years from the same investment.
3
Streamlined Permitting & Design
BENEFIT 3: Expert Navigation of LA's Complex ADU Permitting
LA's ADU regulations are notoriously complex. Setbacks, grading, utilities, fire-resistant materials, parking—miss one requirement and the city rejects your plans.
Most homeowners take 8–14 months to get permits approved. Some never do.
Coast Builders Group has permitted many ADUs. We know which designs pass first-time. We submit complete applications on first try. We avoid rejection cycles. We maintain city relationships that get your calls answered fast. We shave 4–6 months off typical timelines.
Every month of delay costs $15,000–$25,000 in material price increases, contractor delays, and postponed rental income.
Why Coast Builders Group wins: Our permitting expertise eliminates delays and surprises. When we say 10 months, we deliver.
4
Flexible Living Solutions
BENEFIT 4: Flexible Living Solutions That Adapt to Your Life
An ADU isn't just income—it's life insurance. Circumstances change. An ADU gives you options.
Today: Your adult child loses their job. They move into the ADU temporarily. Tomorrow: They're back on their feet—you rent it to a tenant at market rate. Five years later: Your parents' health declines. They move in safely, close to you. Decades later: You're retired, the ADU generates $30K+/year in passive income.
Unlike renovations that serve one fixed purpose, an ADU is endlessly flexible. Rental income when you need it. Family housing when life requires it. Complete independence with professional, beautiful finishes—whether it houses family or generates revenue.
Why Coast Builders Group wins: We design ADUs that work as premium rentals OR family housing. Beautiful enough for aging parents. Professional enough for tenants to compete for. Versatility that pays dividends for 30 years.
Why Coast Builders Group for Your ADU?
✓ Design-Build experienced in ADU design and construction
✓ Expert navigation of LA County ADU regulations
✓ Full-service: design, permits, construction, completion
✓ Transparent budgeting and realistic timelines
✓ Fire-resilient design standards built-in
✓ 20+ ADUs permitted and built across Los Angeles
ADU Process
Building an ADU doesn't have to be complicated. Coast Builders Group handles every step—from evaluating your property to delivering keys in hand. Our proven 4-step process keeps you informed, timelines realistic, and costs transparent. Here's exactly what happens when you partner with us.
Step 1: Consultation & Site Assessment
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Free meeting to evaluate your property
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Determine ADU feasibility and potential
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Discuss timeline, budget, and goals
Step 2: Design & Permitting
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Custom design tailored to your property
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Full architectural drawings
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Navigate city approval process
Step 3: Construction
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Expert craftsmanship from foundation to finish
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Regular project updates
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Quality inspections at every phase
Step 4: Move-In Ready
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Final inspections and approvals
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Keys and documentation
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Move-in ready for residents
ADU Investment & Timeline
Understanding the True Cost and Payback of Your ADU
The question every homeowner asks first is simple: "How much will this cost, and how long will it take?" The answer is powerful. Most of Los Angeles ADUs pay for themselves in 7–10 years through rental income alone, while your property gains 20–35% in value from day one. Below, we've broken down realistic budgets for different ADU types, transparent timelines for design through move-in, and financing options that turn your dream into immediate income.
Whether you're exploring an ADU for financial returns, multigenerational housing, or long-term flexibility, these numbers show why thousands of LA homeowners are saying yes to ADUs right now.
Typical Budget Ranges
What Different ADU Investments Look Like
Standard 1-Bedroom ADU: $150,000–$250,000
• 600–800 sq ft with open floor plan
• Basic finishes: standard cabinetry, durable flooring, functional design
• Compliant electrical, plumbing, HVAC systems
• Perfect for: Rental income, guest house, flexible living
• Monthly rental potential: $1,200–$1,600 (averages $1,400)
• Breaks even in: 12–15 years through rental income alone
Premium 1-Bedroom ADU: $250,000–$350,000
• 700–900 sq ft with separate living and bedroom areas
• Higher-end finishes: custom cabinetry, luxury flooring, designer fixtures
• Energy-efficient systems (heat pump HVAC, smart thermostats)
• Outdoor living space: patio, deck, landscaping
• Perfect for: Long-term tenant retention, luxury rental market
• Monthly rental potential: $1,800–$2,300 (averages $2,000)
• Breaks even in: 10–12 years through rental income alone
2-Bedroom ADU: $300,000–$450,000+
• 900–1,100 sq ft with two separate bedrooms
• Two full bathrooms, living room, dining, kitchen
• More complex mechanical systems and design coordination
• Higher finishes and potential outdoor entertainment space
• Perfect for: Families, multigenerational living, higher rental income
• Monthly rental potential: $2,000–$2,800 (averages $2,400)
• Breaks even in: 8–10 years through rental income alone
Cost Breakdown Example (Typical 1-Bed ADU @ $200,000):
• Foundation & site work: $15,000–$20,000 (7–10%)
• Framing & exterior shell: $35,000–$45,000 (17–22%)
• Mechanical systems (electrical, plumbing, HVAC): $25,000–$35,000 (12–17%)
• Interior finishes (drywall, paint, flooring): $40,000–$50,000 (20–25%)
• Kitchen & bathrooms: $25,000–$35,000 (12–17%)
• Permits, engineering, architectural design: $10,000–$15,000 (5–7%)
• Contingency buffer (10–15%): $15,000–$20,000 (7–10%)
Realistic Timelime
From Concept to Move-In: A Transparent Timeline
Phase 1: Design & Permitting Preparation (3–4 Months)
Week 1–2: Site Assessment & Concept
• Free consultation evaluates your property's ADU potential
• We assess lot size, zoning, setbacks, utilities, site challenges
• Initial concept sketches show 2–3 design directions
Week 3–8: Design Development
• Team creates detailed designs based on your preferences
• You review floor plans, review exterior style, discuss finishes
• Structural engineer performs calculations and feasibility analysis
• Final design approved and locked in
Week 9–12: Construction Documents & City Prep
• Detailed architectural drawings created for permitting
• All structural details, mechanical system layouts, material callouts finalized
• Permits prepared and ready to submit
• Timeline: Ready for city submission in 3–4 months total
Phase 2: City Permitting & Approval (4–8 Weeks)
Week 1: Submittal
• Plans submitted to city planning and building departments
• Application fees paid ($2,000–$5,000 typical)
Weeks 2–4: Plan Check Review
• City reviews for code compliance, setbacks, parking, design standards
• City may request corrections or clarifications (normal process)
Weeks 5–6: Revisions (If Needed)
• We address city comments and resubmit revisions
• Most ADUs get approved on first or second revision
Weeks 7–8: Approval & Permit Issuance
• Building permit issued—you're officially cleared to build
• Expected timeline: 6–8 weeks total, sometimes faster with pre-approved designs
Phase 3: Pre-Construction & Mobilization (2–3 Weeks)
Before the first shovel hits ground:
• Financing finalized and funds secured
• Materials ordered (long-lead items: windows, doors, cabinets)
• Site prepared: temporary facilities set up, utilities coordinated, safety barriers installed
• Final walkthrough with architect confirming site conditions
Phase 4: Construction (4–6 Months)
Weeks 1–4: Foundation & Site Work
• Excavation and grading to engineering specifications
• Foundation dug and poured, concrete cured and inspected
• Underground utilities (electrical, plumbing, gas) installed
Weeks 5–8: Framing & Weather Seal
• Wood framing erected: walls, floor joists, roof trusses
• Sheathing applied, roofing installed
• House wrap applied for weather protection
• Your ADU suddenly looks like an actual home
Weeks 9–11: Rough Mechanical Systems
• All electrical wiring, outlets, and circuits run through walls
• All plumbing (water supply, drain, vent lines) installed
• HVAC ductwork and equipment installed
• Building inspection occurs here—critical checkpoint
Weeks 12–17: Insulation, Drywall & Interior Finish
• Insulation installed for energy efficiency
• Drywall hung, taped, and finished
• Interior paint applied throughout
• Interior doors, trim, and cabinetry begin installation
• Visible progress accelerates—rooms take shape
Weeks 18–22: Kitchen, Baths & Final Finishes
• Kitchen cabinetry, countertops, backsplash installed
• Bathroom vanities, toilets, showers installed and tested
• Flooring installed (tile, vinyl, carpet)
• Electrical fixtures, light switches, outlet plates finished
• Exterior finishes: siding, stucco, or painted surfaces completed
Weeks 23–25: Final Systems & Punch List
• All plumbing tested and inspected
• Electrical testing and final inspection
• HVAC testing and balancing
• Final walkthrough: you note any punch list items for completion
Week 26: Final Inspection & Occupancy Approval
• Building department conducts final inspection
• Certificate of occupancy issued—you're officially approved to rent/occupy
• Keys handed over, congratulations
TOTAL PROJECT TIMELINE: 7–10 Months Average
• Simple projects (clear site, no complications): 6–8 months
• Typical projects (standard LA lot): 8–10 months
• Complex projects (hillside, utilities, design challenges): 10–12 months
Pro Tip: Design quality and early planning compress timelines. Rushing design creates construction delays and expensive changes. We invest heavily in planning so construction runs efficiently.
Financing Options
Financing Your ADU: Real Options for Real Homeowners
Option 1: Home Equity Line of Credit (HELOC) – MOST POPULAR (60% of ADU Owners)
How It Works:
• Borrow against your home's existing equity
• Flexible draw schedule—take what you need when you need it
• Variable interest rate (typically Prime + 0–1%)
Typical Terms:
• Interest rate: 8–10% (as of 2026)
• Maximum borrow: Up to 85% of home equity
• Draw period: 5–10 years (interest-only payments)
• Repayment: Converts to principal + interest after draw period
• Monthly payment example: $200K HELOC at 9% = ~$1,500/month interest-only
Advantages:
✓ Fastest approval (1–2 weeks)
✓ Lowest interest rates available
✓ Flexible—only pay interest on what you draw
✓ Can refinance rates later if market improves
✓ Simple application process
Disadvantages:
✗ Variable rate (rates could increase)
✗ Lender can freeze your line if home value drops
✗ Your primary residence is collateral
Best For: Homeowners with 30%+ home equity, comfortable with variable rates, want simplicity
Option 2: Construction Loan – BEST FOR CASH MANAGEMENT
How It Works:
• Lender disburses funds in phases as construction progresses
• You only pay interest on funds drawn (not the full loan amount)
• Much lower carrying costs than HELOC
Typical Terms:
• Interest rate: 9–11% (typically Prime + 1–2%)
• Full amount: 100% of construction budget (no equity required upfront)
• Disbursement: 4–5 draws as milestones are reached (foundation, framing, rough, interior, finish)
• Timeline: Funds released monthly/quarterly based on construction progress
• Repayment: Interest-only during construction (typically 6 months), then refinance to permanent HELOC or mortgage
Advantages:
✓ Only pay interest on money actually used (saves $2,000–$4,000)
✓ Monthly disbursements align with construction costs
✓ Forces disciplined spending (only release when work complete)
✓ No collateral required beyond future lien on property
✓ Easier qualification for some borrowers
Disadvantages:
✗ Longer approval timeline (3–4 weeks)
✗ Additional closing costs ($1,500–$3,000)
✗ Slight higher rates than HELOC
✗ Requires refinancing after construction complete
Best For: Budget-conscious homeowners, first-time ADU builders, want to manage cash flow carefully
Option 3: Cash Payment – ZERO INTEREST, FULL CONTROL
How It Works:
• Pay $200K+ out of pocket from savings or liquidated investments
• Own the ADU outright from day one
• No debt, no interest, no monthly payments
Advantages:
✓ Lowest total cost (zero interest)
✓ Ownership from day one
✓ No debt service limits
✓ Rental income = pure profit
Disadvantages:
✗ Ties up significant capital
✗ Opportunity cost (could invest money elsewhere)
✗ Creates cash flow challenge during construction
✗ In practice, most cash buyers take HELOC after month 3–4 when they realize construction is longer than expected
Reality Check: Most cash buyers end up taking a HELOC anyway for ongoing expenses. Plan accordingly.
Best For: Wealthy homeowners, investors prioritizing ownership, comfortable with illiquid assets
Option 4: Hybrid Approach – SMART STRATEGY (30% of ADU Owners)
How It Works:
• Use cash or HELOC to cover design, permits, site work ($40K–$60K)
• Secure construction loan for 75–80% of remaining build cost
• Refinance after completion into permanent HELOC or amortizing loan
Advantages:
✓ Spreads costs intelligently
✓ Reduces carrying costs (only pay interest on construction draws)
✓ Maintains liquidity and flexibility
✓ Lowest total financing costs
✓ Lower stress and risk
Typical Flow:
1. Use $50K HELOC for design + permits + site prep (no construction yet)
2. Secure $140K construction loan for the actual build
3. After completion, refinance to permanent HELOC at better rates
4. Total financing cost: ~$30K–$40K in interest, but spread over manageable periods
Best For: Smart homeowners who want cost control + flexibility + liquidity preserved
RECOMMENDED PATH FOR MOST HOMEOWNERS:
1. Consult with your lender to pre-qualify for HELOC ($250K) or construction loan ($200K)
2. Use Coast Builders' free consultation to confirm ADU feasibility
3. Design phase: Use $50K from available credit to fund design + permits
4. Construction phase: Draw construction loan or HELOC as work progresses
5. Move-in: Start collecting rent immediately
6. Refinance after 6 months: Lock in better permanent rates
The R.O.I
The Numbers: How ADUs Pay for Themselves
Scenario: $200K Standard 1-Bedroom ADU in Los Angeles
INCOME STREAM:
Monthly Rent: $1,400 (conservative market rate)
Annual Gross Rental Income: $16,800
Less Operating Costs (property tax, insurance, maintenance): -$4,000/year
Annual Net Income: $12,800
PROPERTY VALUE INCREASE:
Typical ADU appreciation: 25% of construction cost
Property Value Increase: $50,000 (added to your home's equity)
Year 1 Total Gain: $12,800 (income) + $50,000 (equity) = $62,800
PAYBACK TIMELINE:
Break-Even Point: Year 7–9
• Through rental income alone: 15–16 years
• Combined with appreciation: 7–9 years
5-Year Projection:
Year 1: $62,800 gain
Year 2: +$15,200 (income + additional appreciation)
Year 3: +$15,600
Year 4: +$16,000
Year 5: +$16,500
5-Year Total: $125,000+ in cumulative gains
10-Year Projection:
Cumulative rental income: $128,000
Property appreciation (conservative 3%): $60,000+
Total gains: $188,000+ on $200K invested
Your $200K investment has essentially paid for itself, and you own a $260,000+ asset.
20-Year Projection:
Cumulative rental income: $256,000
Property appreciation: $100,000+
Total gains: $356,000+
Your property has tripled in value, and you've collected a quarter-million in rental income.
TAX ADVANTAGES:
Mortgage interest deduction: ~$2,500–$5,000/year (if financed)
Depreciation schedule: 27.5-year deduction = $7,000+/year tax benefit
Operating expense deductions: Property tax, insurance, maintenance = $4,000/year
The Math: Your ADU investment isn't just real estate—it's tax-optimized income with appreciation upside.
ADU Questions Answered
Everything You Need to Know About Building an ADU in Los Angeles
We hear the same questions from every homeowner considering an ADU.
Can I build one on my property? How much will it really cost? How long does it take? Will it hurt my property taxes? Can I actually rent it out?
Below are honest, detailed answers to the questions we answer most. If you have questions we haven't addressed, schedule a free consultation!
We love talking about ADUs and your property's potential.