Facebook Instagram
619-658-1113
Contact Us
Facebook Instagram
(801) 903-2219
Get Started

CALIFORNIA'S LEADING ADU RESOURCE

Our team is here to guide you through the process of building your ADU in California.

Follow These 10 Essential Steps to Successfully Build an ADU in Utah

Follow steps below to explore more details

Step 1: Defining Your Purpose

Building an ADU typically addresses a specific need. Most people pursue this project for one of three common reasons. Identifying your unique purpose will serve as a guiding principle throughout the process. Establishing clear goals aligned with your "why" will help you shape a focused and effective strategy.

Finances

Consider utilizing your ADU as a means to achieve long-term financial stability by generating rental income. This strategy can also offer potential benefits such as tax advantages, deductions, and a solid return on investment over time.​

Supporting elderly relatives, whether medically or financially, or preparing for your own future care needs, could become a priority. An ADU offers a practical solution, providing a space that allows for independence while serving as an in-home assisted living arrangement.

An ADU can serve as a launching pad for your children, offer financial support for a growing family, provide housing for relatives in need, and become a valuable asset to pass down to the next generation.

Your reasons for considering an ADU are likely a blend of various factors. In the short term, you might aim to offset your mortgage as your family expands, while in the long term, your focus could shift to retirement planning. You may also have an immediate need to accommodate an elderly relative, all while seeking to grow your investment portfolio. Clearly defining your goals for your ADU will shape your design choices. Reach out to us, we’re here to help you explore the wide range of benefits an ADU can offer and guide you in achieving your vision.

Step 2: Develop a Comprehensive Plan

No matter your personal "why," it’s essential to approach your ADU project with a well-rounded plan. Understanding how you’ll manage this resource before construction begins can save you significant challenges later. Consider the following key aspects:

Managing Tenants

Treat your ADU project as you would a business venture. You might consider establishing an LLC and collaborating with a property management company and reliable contractors to optimize your return on investment.

If your objective is to create an assisted living space, whether for your parents or for on-site medical staff, it’s essential to ensure your ADU is designed to be medically accessible and compliant with ADA standards.

The purpose of your ADU is likely to change over time. Think about how your goals may evolve in the future and design the space to meet both your immediate needs and long-term objectives.

An ADU functions as a business, and building a team of experts is essential for its success. At ADU Utah, we connect you with the specialists you need to support the long-term planning and management of your ADU. Reach out to us to learn more!

Step 3: Dive Into Research

With your "why" clearly defined and a vision for your ADU in place, the next crucial step is to thoroughly research local regulations. Understanding what’s permitted in your area is essential before moving forward. Avoid costly mistakes by ensuring your plans align with local requirements. Now is the time to focus on gathering all the necessary information!

City Ordinances

Review your city or county ordinances to understand what is legally permissible on your property. Be aware that multiple regulations may apply, and it's important to ensure compliance with all relevant requirements.

Your property may have additional limitations beyond legal restrictions, such as easements, parking and utility access, physical size constraints, or accessibility challenges. Understanding these factors is essential for designing an ADU that is both practical and compliant. If you’re unsure about what’s feasible, reach out to us. We can help you determine the specific possibilities for your property.

An ADU can significantly influence how you use your property and impact your lifestyle. It's important to identify what will and won’t work for you in advance. Factors like shared backyard space, noise, and parking can lead to challenges if not addressed during the planning phase.

City regulations ultimately dictate what you can and cannot build. To legally construct and rent out an ADU, you must comply with your city’s specific requirements. This includes obtaining building permits, registering your ADU, and completing all necessary forms and agreements required by your city. Since each city has its own unique processes and documents, contact us, and we’ll assist you in navigating the requirements to ensure a smooth experience.

Step 4: Calculate Your Costs

With a clear understanding of local regulations, your property’s potential, and how to collaborate with your city, it’s time to explore financing options. This step involves creating a rough budget estimate for your project. Keep in mind, you’re building a home, it’s still a significant investment. Here are some key factors to take into account:

Construction Expenses

Construction costs for new projects in Utah can vary depending on the design and builder, typically ranging from $200 to $300 per square foot. Basement remodels are often more affordable, costing between $100 and $200 per square foot. For an accurate and actionable estimate, you'll need a finalized design approved by the city. Reach out to us for more information!

Connecting your ADU to utilities can be a substantial expense, often ranging from $12,000 to $30,000, and unexpected costs may arise. Conducting an on-site property review is essential to accurately estimate these expenses. Contact us for assistance, and we’ll help you determine what’s needed for your project.

Construction projects can be messy and may significantly disrupt your existing landscaping. Be sure to include items such as sprinkler repairs, lawn restoration, patios, walkways, and driveways in your budget. Thoughtful planning can help minimize these additional costs. Contact us for more information and assistance with your project.

Determine your return on investment by estimating your construction costs and selecting a financing model for the project to understand your monthly expenses. Be sure to account for additional costs such as utilities, property taxes, insurance, and routine maintenance. Next, research rental rates for apartments or houses comparable to the ADU you plan to build in your area. Using this data, calculate your projected monthly cash flow and ROI.

Life isn’t solely about financial decisions. What intangible benefits could your project bring? Think about factors like family needs, security, caring for aging parents, increasing property value, planning for retirement, downsizing, or potential tax advantages. ADU Utah can connect you with professionals to help you explore these aspects in detail. Contact us to learn more!

Step 5: Finalizing Your Design

After thoroughly researching local regulations, estimating costs, and setting clear goals for your ADU, it’s time to move forward and commit to a design.

Plan Twice, Build Once

Creating a detailed building plan is essential for obtaining an approved permit and starting construction. While developing this plan can be a time-consuming and complex process, investing effort into thorough planning will ultimately save you money over the long term.

Your construction costs will largely depend on the details of your plan. A well-thought-out plan reduces the likelihood of unexpected expenses. Keep in mind that material and labor costs can vary, so it’s wise to prepare for potential surprises. Be as specific as possible about the quality and types of finishes you intend to use.

Having approved plans allows you to request bids from multiple contractors, ensuring you receive the best value and accurate pricing for your project. Additionally, financial institutions require finalized construction plans before you can apply for or secure a loan.

At ADU Utah, we specialize in designing tailored ADU plans that are customized to fit your property and meet your specific needs. Our plans are developed to comply with all relevant municipal codes and state regulations. For more details about the process and estimated costs, feel free to contact us!

Step 6: Securing Financing

Navigating the financial approval process can feel overwhelming, with challenges like credit checks, budgeting for unforeseen expenses, and ensuring every detail is accounted for. The good news? There are various options available to finance your ADU. Here's an overview to help you get started.

Conventional Financing

Financing your ADU can be approached similarly to financing a traditional full-size home. While this method is familiar to many homeowners, it can often be a lengthy process. In some instances, exploring loan options specifically designed for ADUs may be more advantageous. Contact us to learn more about ADU-specific financing solutions.

A Home Equity Line of Credit (HELOC) allows you to borrow against the equity in your home, making it a viable option for financing your ADU. Since the funds come from your home’s equity, it’s akin to borrowing from yourself using the value you’ve already built. Contact us to connect with a HELOC specialist who can help you explore your options.

You may have the option to borrow against your investment portfolio to finance your ADU. If the ADU will be used to house family members, another approach is to collaborate on the project by having them act as the mortgage lender for the ADU. Contact us to learn more about these financing options.

Step 7: Building Your ADU

The construction stage is the most hands-on and detailed part of your ADU journey. To stay organized and achieve the best results, this phase can be broken down into ten distinct steps. Here’s an overview of what to expect:

How to Choose the Right Builder

Selecting the right builder is one of the most critical decisions you’ll make. Start by ensuring they conduct an in-person site visit. During your meeting, assess how thorough and detail-oriented they are, a builder who cuts corners can lead to costly mistakes. Always request and follow up with genuine references to verify their work. If you need assistance finding the best builder for your project, don’t hesitate to contact us for guidance.

Being well-informed about the construction process reduces the risk of misunderstandings or being taken advantage of. Below are the key phases involved:

- Permitting and approval
- Planning and site preparation
- Excavation and foundation work
- Framing and rough-in installation
- Four-way inspection
- Insulation and drywall installation
- Finish carpentry
- Painting
- Flooring installation
- Cabinet installation
- Appliance setup
- Hardware installation
- Final inspection

Understanding these steps will help you navigate your project more confidently.

Throughout the construction process, several inspections are required, including checks for utility connections, foundation work, four-way inspection, and the final inspection. Contact your local building department to confirm the specific inspections they mandate. Click here to access contact details and ADU regulations for cities and towns in Salt Lake, Davis, Weber, Utah, and Summit counties.

It’s important to keep copies of all city inspection reports for your records. You can request these from your builder or access them directly from the city, as most municipalities make inspection results available online.

Subcontractors have the right to file a lien against your property if the general contractor fails to pay them. To protect yourself, ask your builder for a complete list of subcontractors involved in your project and ensure you obtain signed lien release documents from each of them.

Collaborate with your general contractor to develop a clear project plan, including the overall timeline, key dates, and deliverables. Be sure to account for holidays and family events in the schedule. Set specific times and days that align with your family’s routine to minimize disruptions. Construction can be chaotic, but effective communication will help keep the process manageable.

Construction can be a messy endeavor, with dust, mud, loose nails, and debris potentially overtaking your property. Starting with a well-thought-out plan to handle these challenges will help keep the mess under control.

Anyone who has experienced a water or sewer line break knows how much construction can disrupt a landscape. Take proactive steps to plan ahead and minimize the potential impact of such incidents on your property.

A change order occurs when modifications are made that differ from your approved construction plans. Familiarize yourself with the plans and the deliverables to ensure clarity. If a change becomes necessary, make sure you review and approve it before the builder proceeds with implementation.

A punch list is a detailed checklist of tasks that must be completed before the construction project is officially finished. It will include items you’re aware of and others you might not immediately consider. Take the time to thoroughly walk through your project as it nears completion, inspecting everything for functionality, fit, and finish. Compile a list of items that need to be addressed before finalizing the project. Review the list with your contractor, come to an agreement, and ensure both parties sign it.

Building an ADU is a complex process that requires extensive knowledge and expertise, much like constructing a full-sized home. At ADU Utah, we have the experience to help you efficiently manage your construction project. Contact us to learn how we can simplify the process for you.

Step 8: Managing Your ADU Asset

An ADU is a substantial investment, and it's essential to maximize its value over time. Whether you plan to generate income or use it as a residential space, effective financial management is key. Here are some important factors to consider as you plan for its long-term management.

Property Management

A property manager takes care of the business aspects of your property in exchange for a small percentage of the rental income. While this reduces your overall earnings, many property owners find the convenience well worth the cost. However, it’s important to choose a reliable property manager, as the quality of service can vary. Contact us for help connecting with trustworthy professionals and avoiding unfavorable arrangements.

If you plan to manage tenants yourself, it’s essential to familiarize yourself with state and local laws governing landlord-tenant relationships. You must apply these laws fairly and be prepared to address legal matters if they arise. Topics such as tenant rights, discrimination, eviction, and other related issues can result in significant costs if not managed properly.

Approach your ADU project with a business owner’s perspective. Consider setting up an LLC, opening business accounts, and developing a tax strategy. Seek out resources and professionals to help you manage these responsibilities effectively. Contact us for assistance in transitioning into a business owner role.

If your ADU will house parents or children, remember that they are still tenants. Balancing the roles of both landlord and family member is essential. Establishing a lease agreement, even among family, can provide clarity and protection for everyone involved, especially when challenges arise.

Step 9: Managing Finances

To ensure long-term success with your ADU investment, it’s essential to adopt a business-minded approach and implement effective strategies. Here are three key methods to help you maximize your returns:

Maintenance and Repairs

Allocate funds for ongoing maintenance and repairs, as issues are bound to arise over time. Prioritize long-term decisions that protect your income stream rather than focusing solely on short-term profits. Responsible upkeep ensures the longevity and success of your investment.

The additional income from your ADU provides an excellent opportunity to explore other investments. At ADU Utah, we encourage you to consult with your financial advisor to learn how to leverage this asset to strengthen your financial portfolio and support long-term growth. We can also connect you with financial planning resources. Contact us if you have any questions.

Now for the most exciting part, allocate a portion of the income for your personal goals and enjoyment. Your ADU should enhance your quality of life, so use some of the earnings to invest in things that improve your living experience today.

Step 10: Living with Family in an ADU

Family dynamics can be complex, and living in close quarters can sometimes amplify these challenges. Here are some tips to maintain strong relationships and harmony while sharing proximity with family in an ADU.

Understand Your Dual Roles as an Owner

As an owner, you’ll need to balance two roles: family member and landlord. Knowing when to adopt each role is key to maintaining harmony, ensuring your comfort, and respecting their independence. A lease agreement is essential, even when renting to family members, to establish clear expectations and boundaries.

Establishing clear financial boundaries with adult children is just as crucial as it is with parents. Create a lease agreement and adhere to it strictly. Failing to do so can lead to complications that may strain the relationship.

Caring for aging parents can become overwhelming, even when they’re nearby. While proximity makes it easier to provide support, it can also lead to taking on more responsibilities than anticipated. Establish clear guidelines for how you’ll support one another, and develop a backup plan that includes external assisted living resources if needed. Contact us to learn more about at-home assisted living and the impacts of caregiving.

Understanding how to transfer property after a death is crucial for preserving long-term value and protecting your legacy from the effects of inflation and taxes as the market evolves.

Congratulations on Reaching the Finish Line!

Building an ADU on your property is a detailed process with many steps to navigate. The information provided here offers a general overview of what it takes to complete your ADU journey. If the process feels overwhelming, don’t worry Nest Tiny Homes is here to guide you every step of the way. If you’re ready to move forward with your ADU plans, contact us to start developing your custom solution and move forward confidently toward success.​

We are your go-to guide for developing your Accessory Dwelling Unit in Utah.

Our mission is to guide individuals in developing a successful plan to utilize ADUs as a tool to support their financial and family goals, both now and in the long term, adapting as their family’s needs evolve.

Trusted Expertise

With firsthand experience navigating the complexities of creating a successful ADU plan, we understand that your goals extend beyond construction. They encompass long-term strategies like rental management, business planning, retirement preparation, and more. We collaborate with expert partners to support the lasting success of your ADU journey.

Insightful Knowledge

Smart investments stem from well-informed decisions. When it comes to your ADU, our mission is to provide you with the comprehensive information you need to ensure a positive return on your investment. We offer valuable resources on accessory dwelling units across the greater Salt Lake City area, as well as Davis, Weber, and Utah Counties, empowering you to make confident choices.

Click Here to Learn More

Exceptional Support

Our dedicated team is here to help you achieve success with your ADU project. At ADU Utah, we collaborate with a network of expert partners who provide comprehensive solutions to address all your ADU questions and planning needs now and in the future.

Contact Us!

Use the form below or call us at (619) 658-1113