There are many reasons why it makes sense to plan for an accessory apartment if you building a new home. It provides unrivaled flexibility while your family is living in the house. If you don’t use the apartment for your family — for say, an in-law or boomerang child — you can rent it to generate income. And demographic trends show that it will probably add value to your home if you go to sell it.
Why? One in five Americans, a total of 64 million people, lived in a multi-generational household in 2016, according to Census data. That’s a huge increase from the 42.4 million people in this cohort only 16 years before, and a big jump from the low water mark in 1980, when 12 percent of households were multi-generational. It’s interesting to note that trend is growing among all racial groups, most age groups, and both men and women.
The classic approach is to build homes with so-called accessory dwelling units (ADUs). They go by many informal names — granny flats, in-law suits, and lane-way houses are a few. They typically have a bedroom, living space, bathroom, and space for food preparation. Lennar has earned national headlines for marketing homes with multi-generational suites that even had laundry rooms and porches. I’ve walked many of them; they read, as the marketing brochures proclaim, as a home within a home. They are typically separated from the main house by a door. From the main house, the door looks like it could be a closet.
There are many intriguing ways to skin this cat. Many California builders for decades have offered homes with optional casitas in the yard often marketed as office space or guest rooms. Local regulations may prohibit the builders from including gas hook-ups for kitchens that make the buildings full-fledged accessory apartments. But they could be easily retrofitted after purchase with electric appliances.
That makes them even better candidates for short-term rentals. The average Airbnb host, pre-pandemic, earned about $11,000 a year in rental income, enough to pay a big chunk of the mortgage. That could come in real handy if you are stretched to the limit trying to make a mortgage payment. Some of the families chronicled in my new book, The Forever Home, could only afford to buy a home knowing they would have the income from an ADU.
Accessory apartments are a nice family insurance policy, too. They came in handy as home classrooms during the pandemic; teachers could enter through separate doorways and never enter the main house. Another family profiled in the book used their ADU as a nursery — a sink to wash out bottles, and a refrigerator for drinks proved invaluable — with the intention of eventually converting it to a family room.
ADUs may be a great arrangement for a boomerang child who can’t find a job or afford a place of his own. A full third of young adults, age 18 to 34, many of them saddled with college loan debt, lived with their parents in 2015, according to Census data. They also come in handy as refuges for adult children who may be going through a divorce. And the classic use is an in-law apartment. Studies I conducted as a magazine editor showed that elderly parents living with children value their independence. They want the option of being on their own — cooking their own meals, doing their own laundry — or joining the rest of the family for a meal or entertainment.
The good news is that cities are more accommodating of ADUs than they were even a decade ago. Planners and politicians have settled on the concept as a way to provide more affordable and diverse housing. That said, they may impose regulations – off-street parking requirements or caps on building size — that restrict what you can build. Some jurisdictions may still require that relatives or domestic help live in the units. Other big cities may regulate how many short-term rentals they allow to preserve long-term rentals for college students, transferred workers, or apartment dwellers.
The classic ADU configuration is a bonus room over the over the garage, ideally served by a separate staircase. That way, renters can let themselves in. You could leave the key for short-term renters in a code-protected lock. This is an ideal configuration for a relative who really wants separation — a returning independent-minded college student or an adult going through a divorce. Stairs make the unit more difficult, though not impossible, to use as an in-law suite. You may want to consider an elevator.
Apartments detached from the main house produce ideal work-at-home space for a writer, a painter, serious student, or anyone else who needs alone time. Connecting the garage and the apartment above it to the main house provides even more flexibility; that may be the preferred solution if local zoning regulations prohibit detached guest units, though sometimes even attaching the garage to the main building with a trellis will get you zoning approval. The beauty of this arrangement is that the guest suite could be conveniently used a playroom for infants, a hang-out space for teenagers, or an apartment for a long-term guest.
There’s no reason, of course, that the apartment can’t be located somewhere else in your home. Depending on the size and configuration of your lot, it could be in the front, back, or side yard of your house. It could even be the basement. Private access from the outside — even if it’s through a basement door — gives you the most long-term flexibility. It also adds to the desirability of the pad as a short-term rental.
A few years ago I stayed in a wonderful old home in a wooded Asheville neighborhood with a huge basement – it had once housed a home bakery. The owners had carved out a bedroom down there for one son. After he finished college, they converted the room to a guest suite. There was a separate basement entrance to the apartment, and the driveway in back was big enough to park several cars; it has previously been used by delivery vans. A steeply sloping lot meant that there was plenty of natural light on the basement level, which included a huge open space with a tall ceiling.
Here’s a plan that takes advantage of a sloping lot to create a basement walk out. Maybe teenagers live downstairs at first. Then when they go away to college, the two bedrooms can be rented. Guests would have their own private entrance. The basement would work great as a guest suite for elderly parents who need their own room because one or both snores loudly. The wet bar in the plan could be upgraded to a kitchen with countertop cooking appliances. There’s enough room for a small dining table adjacent to the wet bar.
Some families enjoy having visitors in the house. One of my favorite places to stay on the road is a private home in Nashville with a two-bedroom suite on the second floor. During a remodel, the host lifted the roof of their story-and-a-half bungalow to create a full second floor. They enjoy talking with renters who enter through the front door and go right up the center staircase. In the morning, I could slip outside unnoticed to enjoy coffee on the front porch. The two upstairs bedrooms share a full bath. And they are served by a den with a couch for watching TV, a desk for getting work done, and an electric piano for composing your next hit song.