Accessory Dwelling Unit

Why ADUs Are A Great Benefit To Portland Neighborhoods

This article was first published in “Hey Neighbor!” the neighborhood newspaper published by NECN.

Accessory Dwelling Units, or ADUs, are secondary residences that can be built on any residential property in Portland and many of the surrounding communities. As housing costs continue to rise, many neighbors search for affordable housing for themselves or loved ones and ADUs can provide wonderful places to live while being much cheaper than buying a house in today’s market. They are also great ways to earn rental income for homeowners, potentially allowing people to stay on their property even if the neighborhood gets more expensive. In short, ADUs are great investments that help build wealth and provide much needed housing. They can be an important part of creating diverse and thriving communities.

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At Propel Studio we have been working in neighborhoods throughout Portland over the past six years to help people navigate the design, permitting and construction process for ADUs. We find ADUs to be great ways to address our housing shortage, while preserving the neighborhood character that we all enjoy.

Here are a few reasons we think ADUs are a great fit for Portland and something that everyone should consider adding to their property:

  • ADUs create opportunities to provide housing while preserving neighborhood character.

  • ADUs are sustainable, by doubling down on residential areas with existing infrastructure and services (preventing urban sprawl).

  • ADUs give homeowners an opportunity to capitalize on their current investment (their property) to build wealth, provide passive income, and help people plan for retirement.

  • ADUs allow for multi-generational living and aging-in-place

  • ADUs are a popular way to downsize while remaining in the community you’ve grown to love.

  • ADUs can be designed to be low-maintenance.

  • ADUs can be designed to be net-zero energy use - meaning your energy bills could be close to $0.

  • ADUs can be cheaper to build than buying a new house to live in.

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Most of the time ADUs are detached buildings (like a backyard cottage), but an ADU can also be created within a renovated basement, attic, or garage. Each property and family is unique, so we work with our clients to talk through all of the options available and find the best solution to their situation - based on budget, existing conditions of the property, and what their goal is for the new structure.

Like any investment, there are costs associated with these. ADUs are not cheap - we find they cost between $170,000 to $275,000 depending on the size, complexity, quality of finishes, etc. This cost is relatively similar regardless of whether you are building new or renovating an existing space. Renovating basement or garages into an ADU is not necessarily cheaper than building a new as often it is more complex to work within an existing structure. In general, new, detached, ADUs are the simplest to build but we have worked on all sorts of ADUs over the past few years.

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We are passionate about ADUs as they can be economic, social, and environmentally sustainable housing opportunities. If you have any questions or are considering building an ADU, we offer a range of free resources on our ADU page, and free consultations at our office.

To help people financially plan for building an ADU, we have developed a simplified proforma spreadsheet that estimates the project costs that need to be considered. This worksheet allows you to play around with various costs and variables and see the impact on the total project cost.

Sneak Peak of Our Latest ADU Project

Our latest ADU in SE Portland was recently completed. Our whole firm met there last week to preview the project and do a final punch list walk through with the client and contractor to identify and final things that needs fixing or adjustments. The best part was to see how happy our client was and to see the results of over a year of hard work by everyone involved.

We were all really pleased with the result. It all came together beautifully and the contractors - Billy Spear and the entire Evergreen Craftsmen team - did an amazing job. Also, because it was a typical rainy Portland day we got to see the scupper and water fall in action!

Below are some sneak peak phone photos I snapped during the walk-through. We are currently scheduling a photo shoot with a professional photographer and will get those up on the website soon.

Book Giveaway: Backdoor Revolution - The Definitive Guide to ADU Development

A friend of Propel Studio, Kol Peterson, has published a new book: "Backdoor Revolution - The Definitive Guide To ADU Development. It is specifically written for planners, ADU advocates, and homeowners who aspire to build ADUs, and we think it would be a great resource for our clients and future clients. 

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About The Author

The author, Kol Peterson is an ADU expert based in Portland, Oregon, who has helped catalyze the exponential growth of ADUs in Portland over the last decade through ADU advocacy, education, consulting, policy work, and entreprenuership. He is the owner of Caravan- The Tiny House Hotel, the first tiny house hotel in the world, and organizer of Portland’s popular ADU Tour.  He consults with homeowners about ADUs on their property, and teaches ADU classes for homeowners and for real estate agents. He edits and manages AccessoryDwellings.org, BuildinganADU.com, pdxadu.blogspot.com, and AccessoryDwellingStrategies.com.

Purchase the book here:
http://www.buildinganadu.com/backdoor-revolution/

What's an ADU and Why Should I Want One?

We have been helping people with the design of ADUs for the past 4 years here in Portland, Oregon. However, as we have started working beyond the city limits of Portland, we quickly realized that these projects are called different things in each city or town. There are at least thirty different names (that we could find) for Accessory Dwelling Units, or ADUs.

You may call them Accessory Dwelling Units or ADUs for short, Laneway Houses, Granny Flats, Alley Apartments, or Carriage Houses. You may find something called a Detached Accessory Dwelling Unit, a DADU, an Accessory Apartment, an Accessory Suite or an Ancillary Unit. Sometimes, they’re called Backyard Cottages, Basement Apartments or Dawdy Houses. Garden Cottages, Garden Suites or Grand Retreats are popular. Many people like Granny Cottages, Granny Pods or Granny Units. We’ve even seen JADUs, Junior Accessory Dwelling Units, SDUs, Secondary Dwelling Units and Secondary Suites. Wouldn’t it be nice to have a Home within a Home, an In-Law Suite or an In-Law Unit? Increasingly, families need Mother-In-Law Flats, Mother-Daughter Houses, Multigenerational Homes or Next Gen Units. HGTV has popularized Tiny Houses and Hawaiians have Ohana Units. Maybe the most interesting name we’ve come across for that smaller, secondary unit is the Sidekick.

Regardless of what nomenclature you use, the theme that ties all of these together, is the desire to add an additional unit to your existing property. In North America, Vancouver, Seattle and Portland are the most popular markets for these types of homes although we have received inquiries from interested clients in the Bay Area in California, and across Colorado, including Denver, Boulder and smaller towns across the state. No matter where you are or what they’re called, Accessory Dwelling Units are growing in popularity.

But, what is an ADU and why would you want one?

By any name and in any location, an Accessory Dwelling Unit is a way to create a secondary dwelling unit (or home) on the property that you already own. Most of the time we think of these as separate, detached buildings (like a backyard cottage), but an ADU can also be a basement or attic apartment. Wherever it’s located, an ADU is a residential opportunity.

In cities where housing costs continue to rise, many of our neighbors are searching for affordable housing opportunities. Different cities and towns have their own rules and regulations concerning Accessory Dwelling Units, but the community benefits are typically the same. These housing types provide for desirable growth and opportunity.

  • Accessory Dwelling Units create opportunities to increase density and provide new affordable housing where housing costs continue to skyrocket.

  • ADUs generate additional property tax income for cities to provide valuable services and amenities to a wider range of people.

  • Accessory Dwelling Units create opportunities for cities and towns to grow sustainably by doubling down in areas with existing infrastructure and services.

  • Accessory Dwelling Units create opportunities to grow while preserving the character of our existing neighborhoods.

  • Accessory Dwelling Units create opportunities for homeowners to capitalize on their current investment (their property) and build wealth.

  • Accessory Dwelling Units create opportunities for neighbors of all family structures and income levels to build community in our most desirable residential areas.

  • ADUs provide opportunities for aging in place

  • ADUs can generate rental income for families at risk of displacement due to rising costs of owning a home.

What opportunities can an Accessory Dwelling Unit create for you?

If you want to know more about Accessory Dwelling Units and how you can build one, download our free “ADU Inspiration Book”.
When you’re ready to get started, schedule a Free Consultation with Propel Studio.

Why do You want to Build an Accessory Dwelling Unit (ADU) in Portland, Oregon?

ADU’s are hot. High land costs and permitting concessions from the City of Portland have made the thought of building an Accessory Dwelling Unit popular among homeowners and want-to-be homeowners in the last couple years. Have you ever thought about building an ADU?

Over the course of our next few articles, I’ll talk about reasons most people want to build an ADU, several tips that will be helpful if you decide to take the leap and even a few things that surprise most people who start the process of designing and building an Accessory Dwelling Unit.

I’d like to start our series on Accessory Dwelling Units by asking you to consider WHY you want to build an ADU.

 

 

The Parents

The idea of downsizing is not new. Many more mature adults decide to move into a smaller home when they retire or when the kids leave home or even when they begin to travel and need a more modest home base. Sometimes those decisions are financial and sometimes they’re based on the amount of time and effort that goes into keeping up a larger home.

The emerging popularity of Accessory Dwelling Units in Portland have given downsizing homeowners a new option to consider. Whether it’s an ADU built in an adult child’s back yard that allows grandparents to be close to grandkids or a tiny house on the parent’s property to give a young-adult child a jumpstart or an ADU in the neighborhood that downsizing parents love and don’t want to leave, ‘The Parents’ is one popular reason to decide to build an Accessory Dwelling Unit in Portland, Oregon.

 

 

The Income Generator

It’s not hard to figure out. If you’ve lived in Portland long, you know land costs and housing costs are high. Designing and building an ADU to rent out on your existing property is a popular idea for homeowners who want to generate some extra income that may help cover those high costs.

When planning and designing and building an Accessory Dwelling Unit that becomes an income generator, most homeowners consider one of two types of renters: long term renters and short term renters. Keep in mind, there are important factors to consider after you’ve decided which type of renter you want to attract. Think about the different wants and needs between someone that rents an apartment and someone that rents an AirBnB or hotel room.

 

 

The Money Saver

What happens when your income changes because you’ve changed jobs or careers or you’ve retired? What happens when you have your first child or your children go off to college? Costs and mortgage payments rarely go down. That’s why some homeowners look at ADUs as money savers.

This scenario is much like the Income Generator, but opposite. Some homeowners decide to invest in designing and building an Accessory Dwelling Unit on their property so they can move into it and rent the main house. It gives them the opportunity to save money on their own living expenses while generating income on the house they used to live in.

Does one of these scenarios speak to you? Do you have parents that want to downsize? Maybe you are an adult that’s ready to downsize. Are you interested in generating some extra income on property you already own? Or, would you like to save money while generating income?

These are all common reasons homeowners in Portland, Oregon decide to build Accessory Dwelling Units on their property. It’s important to understand that each of these reasons comes with their own design challenges and opportunities. Each requires special considerations in order to make the project successful.


If any of these reasons interest you, please download our free “ADU Inspiration Book” and watch for the next couple articles where I cover helpful tips for designing and building an ADU and also things that often surprise our ADU clients.

Article 2 of 3 in this series is "5 Biggest Surprises our Clients Discover when Designing and Building an Accessory Dwelling Unit (ADU) in Portland, Oregon"

Article 3 of 3 in this series is up next!  Stay tuned!

5 Ways Portland, Oregon Community Development Companies (CDCs) Can Benefit From The ADU Craze

As housing costs in Portland, OR continue to escalate, while access to affordable housing redefines crisis levels, it is increasingly difficult for organizations to meet their housing driven missions.

Many Portland-area Community Development Corporations (CDCs) meet their housing access missions by developing multi-family housing projects or purchasing and renovating or constructing new single family homes. Their portfolios are effective in meeting their mission, but are ultimately hamstrung by a number of factors.

As your organization looks out 5, 10 or even 15 years, does your current redevelopment model eventually lack in housing diversity? Will your budget strain under the costs of deferred maintenance? Are you ultimately limited by the physical footprint of your CDC area? Will your tenants have the ability for their families to grow and change without being dislocated?

You’re surely familiar with the recent explosion of popularity that Accessory Dwelling Units (ADUs) have enjoyed in Portland and in many other cities. Last year alone, the City of Portland received more than 250 ADU permit applications. These are great ways to add new housing stock to land you already own. Many individuals have already asked the question "Why not build a small-scale house in your backyard?" Their parents could live there; renters could live there as they generate rental income; or they could live in the ADU themselves and rent the main house to a family.

Those are all great reasons to consider building an ADU, but how can your CDC benefit from the ADU craze? At Propel Studio, we believe there are 5 key ways your Portland, Oregon CDC can benefit:

1.  Quickly and inexpensively expand your housing stock within the existing footprint of your CDC.

After a thorough analysis and inventory, we can help you identify the development opportunities that exist on the properties you already own. Imagine doubling your housing portfolio without incurring any land acquisition costs. Almost every property in a SIngle Family Zone within Portland can accommodate an ADU. Often the biggest hurdle to providing more housing is the costs involved in acquiring new land. In this scenario, we can build new housing opportunity and eliminate the hurdle of purchasing the land as it is already in your portfolio. 

2.  Expand your housing stock without displacing current/long-term residents.

Developing multi-family projects is an effective way to meet your housing access goals, but these projects tend to displace neighbors and sometimes lead to gentrification in the neighborhood. Imagine developing a significant increase in your housing stock without displacing a single family. Instead, you can keep families in their long-term homes and potentially allow for these families to grow or multi-generational living to happen on a single lot. 

3.  Diversify the product mix in your housing stock.

Many times, financing and market forces dictate that a CDC’s portfolio grows in a certain direction. Maybe you’re heavy on single family homes or maybe it’s been more feasible to develop multi-family projects lately due to funding available. What if you could introduce a product mix that not only diversified your housing portfolio but also diversified residents you’re able to serve? Accessory Dwelling Units can take a lot of forms and can offer a wide range in housing types. We can design two storey 2-bedroom units for young families, or single level versions that are fully ADA compliant for ageing-in-place. There is also the option to create smaller, more affordable studio apartments. These are just a few of the wide range in housing types that can be offered through this creative project type. 

4.  Leverage available financing vehicles to cover deferred maintenance costs.

It’s no secret that it’s easier for a CDC to get financing for new construction than it is to find a way to cover maintenance costs. Many organizations like yours struggle with deferred maintenance costs. What if building a fleet of new ADUs helped generate the funds to cover much-needed deferred maintenance projects? One of the things we have been interested in, is using ADUs as a means to generate funds that can further your mission. ADUs can be rented as affordable units to low-income residents, but they could also potentially be rented as market-rate apartments, bringing in much-needed revenue that can be used for deferred maintenance and other costs on your existing assets. 

5.  Leverage existing incentives to save on development costs.

You already know that development costs in Portland are high and prices for land and construction costs are rising. What if you took advantage of the City’s ADU incentives and saved as much as $10,000-$20,000 per ADU unit in development costs? Currently, the City of Portland is waiving the majority of SDC fees until July of 2018, and permitting detatched Accessory Dwelling Units can be as low at $4,000-$5,000. Compare that to the permitting costs of a new single family house and you can see that now is a perfect time to maximize the benefits of investing in these projects. 

If your organization is looking to the future and thinking you can do more to provide better access to housing; if you’re thinking you can do more to support your neighborhood and it’s diversity, consider adding Accessory Dwelling Units to your properties in Single Family Housing zones.

ADUs in Portland, Oregon can currently help you quickly, efficiently and cost-effectively increase your housing portfolio. They can help you grow and diversify your housing stock without displacing your neighbors. They can even help you save money and solve the deferred maintenance crisis you may be facing.

If you’d like to know more about our experience with the benefits of ADU development, let us know. We’ll be glad to help.