Budget & Finance

Our ADU Calculator is a great place to start when developing a budget. It provides a rough estimate of costs and income and will help you understand how choices can impact your budget over time. In general, it is helpful to avoid having a fixed budget total in your head as you explore your options. The cost to build an ADU typically ranges from $30,000 for a simple interior conversion JADU, to $400,000+ for a large detached ADU with high-end finishes on a hillside lot. Cost per square foot is a good way to estimate, though this too can vary — a rough placeholder for you to use is $175 per square foot for construction and other costs (design, fees, etc.), depending on your design and the materials you chose.

See more details about costs – including design, permitting, and construction – in our ADU Guidebook.

Many homeowners use a mix of options to finance their ADU, including their own savings and assets, funds from family, and/or loans. Be sure to consider potential rental income when deciding how to finance your ADU, since it will be a source for repaying loans. It is strongly recommended that you do not begin any construction without your financing plan in place. See our Guidebook and Exercises for more details on financing options.

If you have substantial equity in your home, a cash-out refinance or home equity loan/line of credit (HELOC) might work for you. You may also consider working with an independent licensed mortgage broker to help you find financing options that work best for your situation.

Adding an ADU will likely affect your property taxes and the resale value of your home. However, your primary house will not be reassessed, and your property taxes will only increase based on the added value of your ADU. For example, if you build an ADU that adds $150,000 to your property value, and your tax rate is 1%, your taxes will increase by 1% x $150,000, or $1,500 per year.

Building a JADU will have a significantly smaller impact on assessed value. In some cases, your taxes will not increase at all. Home sharing will also not increase the assessed value of your home. Generally, garage conversions will not raise your tax bill as much as new construction, but they will also not add as much value.

Each property will require a one-on-one analysis to determine the added value of an ADU, so contact the San Bernardino County Assessor Recorder Office once you have an idea of your plan and they will be able to provide you with a rough estimate of tax implications. Visit their website for contact information and resources.

Adding an ADU may impact your income taxes as well. This can be rather complicated, and it’s best to discuss these with a tax advisor.

No. An ADU or JADU may be rented, but, except as otherwise provided in California Government Code Section 66341, no ADU or JADU may be sold or otherwise conveyed separately from the primary dwelling (in the case of a single-family lot) or from the lot and all of the dwellings (in the case of a multifamily lot).

Rental income is a substantial benefit of having an ADU or JADU on your property – for many people, this provides valuable flexibility in their budget. In the City of Upland, you cannot rent your ADU for less than 31 days at a time (e.g., Airbnb, Vrbo). Our ADU Calculator can help you estimate how much rental income could be generated by your new unit.