Three years ago, we wrote a blog post claiming Portland is ADU City (Baby) and predicted we’d see more and more pop up in our neighborhoods. Well, sure enough, Portland’s ADU trend is rising to new heights.
Why? Simply put, there’s still a housing shortage. Because ADUs are allowed in more areas than duplexes, triplexes, and apartments, many people are turning to building a second, compact home right in their backyard. Moreover, local government in Portland and other major cities with housing shortage are widely encouraging this movement, so much so that since 2010 the City of Portland has been waiving expensive system development fees, saving up to $19,000 in building costs. In 2016 alone, the city issued 615 permits for new ADUs.
So what is an ADU? The most common compact home, or accessory dwelling unit (ADU) that shares a lot with a larger existing home, and is independent from the main living quarters. They can range in size from a small single-car garage size of around 250 square feet, up to a generous 800 square feet. As for style? Think stylish architecture over storage shed. Some owners opt to match their primary house, but they are no longer required to do so by the City of Portland. ADUs can be created by carving out space from underused rooms inside a residence, converting an unfinished basement or structurally sound garage into new living quarters with a kitchen sink, stove, and shower, or adding a second story to a garage.
In terms of investment benefit, adding a small second home can become quite lucrative and eco-friendly in the long-term. Renting out the ADUs can reduce mortgage payments and increase home equity. People love their neighborhood or low mortgage and don't want to move but they need more space or want to rent out an apartment for added income. Their small size also translates into a smaller carbon footprint over the lifecycle of the unit. In addition, some are turning to ADUs to help them age in place down the road. They can live in the smaller living quarters and rent out the main house to fund their retirement. In our 2015 post, we shared a story where a resident was able to cover his entire PITI each month, enabling him to live for free!
There are a variety of benefits to investing in an ADU and Portland has fully embraced the idea, making us a leader of ADU development in the United States.
The Portland Home Team will be happy to answer questions, recommend neighborhoods and properties and ensure you find the home that meets your needs!
- Portland Home Team: Experience. Excellence.
Info provided by oregonlive.com