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Building an External ADU and Renting it out

by janeausten
adu builder San Jose

Constructing an external Accessory Dwelling Unit (ADU) can be a great way to create additional rental income for homeowners. An ADU is an additional living space built on the same property as an existing home, often called a granny flat. This type of structure is advantageous for homeowners for several reasons: it can increase the value of their property, provide additional income from rental income, and offer flexibility in terms of potential tenants.

Additionally, adus are typically more affordable than purchasing an entirely new property. In this blog post, we will be discussing the benefits of building an external ADU from adu builder San Jose and renting it out, from obtaining the proper permits to finding tenants and managing the unit. This post will provide a comprehensive overview of creating a successful and profitable external ADU rental business.

1. Research local zoning regulations

Before you start building an ADU, you’ll need to research local zoning regulations. Different cities have different laws on what type of adus are allowed, what size and height restrictions there are, and other factors that you need to consider. It’s important to get familiar with these regulations before you start the building process, so that you can make sure that your ADU meets all the requirements and you don’t have to spend time and money on reworking it to comply with the law.

2. Get permits for construction

Before you begin building your external ADU, you’ll need to make sure you’re in compliance with any local building codes and zoning laws. Depending on the complexity of your project and the regulations in your area, you may need to get permits from your local government. These permits can include things like building permits, electrical permits, plumbing permits, and more. Make sure you do your research and understand exactly what permits you need before you begin building.

3. Consider hiring an experienced contractor

Employing a seasoned builder is the third step to take into consideration when constructing an outdoor ADU for the purpose of renting it out. An expert contractor can assist you in selecting the appropriate materials and design to satisfy your particular requirements while staying within your financial constraints. They will also be able to provide you with guidance regarding any prospective building codes and laws that might be relevant to the project. You will be able to build a plan ahead of time and a financial plan if you choose an experienced contractor who can also provide cost estimates and timetable expectations. When constructing an accessory dwelling unit (ADU) outside the primary residence with the intention of renting it out, it is imperative to work with a contractor who has prior expertise.


Building an external ADU is a great way to add extra living space, and potentially an additional income stream. It requires careful planning, however, with the local government regulations and zoning laws. The best way to get started is to talk to an experienced architect or contractor and make sure you understand the process. With the right team and plan in place, you can make your rental dreams a reality.

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