Are you having a hard time finding the right home in your budget? Or maybe you already own a home but could use some extra income or a designated space for aging loved ones. Either way, accessory dwelling units (ADUs) could be the smart solution you’ve been looking for in today’s market.
What Is an ADU?
According to Fannie Mae, an ADU is a small, separate living space that’s on the same lot as a single-family home. It must include its own areas for living, sleeping, cooking, and bathrooms independent of the main house. And they can take shape in a few different ways. Fannie Mae adds, an ADU can be:
- Within a main home, such as a basement apartment
- Attached to a main home, such as a living area over a garage
- Detached from the home entirely; it could even be a manufactured home
The Benefits of ADUs
ADUs are growing in popularity as more people discover why they’re so practical. In fact, a recent survey shows that 24% of agents say an ADU, such as a mother-in-law house, is one of the most desired features buyers are looking for right now.
The growing appeal makes sense. With rising costs all around you, an ADU can help supplement your income and ease some of the strain on your wallet. Whether you buy a home that has one already or you add one on, it gives you the option to rent out that portion of your home to help pay your mortgage.
Here are some of the other top benefits of ADUs, according to Freddie Mac and the AARP:
- Living Close, But Still Separate: You get the best of both worlds — more quality time together, plus privacy when you want it. If that sounds like a win, it might be worth looking for a home with an ADU or adding one to your home.
- Aging in Place: Similarly, ADUs allow older people to be close to loved ones who can help them if they need it as they age. It’s a sweet spot that offers independence and support from loved ones. For example, if your parents are getting older and you want them nearby, this could be a great option for you.
- Built-In Childcare: If your family’s living in the ADU, you may be able to use them for childcare, which can also be a big cost savings. Plus, it gives your kids more time with their grandparents.
It’s worth noting that since an ADU exists on a single-family lot as a secondary dwelling, it typically can’t be sold separately from the primary residence. And while that’s changing in some states, regulations vary by location. So, connect with a local real estate expert for the most up-to-date guidance.
Bottom Line
In today’s market, buying a home with an ADU or adding one to your current house could be worth considering. Just be sure to talk with Micah Stovall at 714.343.9294. He can explain local codes and regulations for this type of housing and what’s available in your area.
Buying Your First Home? It’s Okay To Feel Excited and Nervous
Buying your first home is exciting, but let’s be real – it can also feel overwhelming. It’s a big step, and with that comes plenty of questions. Am I making the right decision? Can I really afford this right now? Will I be able to make ends meet if I have unexpected repairs? What if I lose my job?
Here’s the thing: every first-time homebuyer has these thoughts.
The homebuying process has always been a mix of excitement and nerves, and that’s completely normal. Here’s some information that can give you a bit of perspective, so you don’t have these concerns.
Focus on What You Can Control
Since homeownership is new to you, you’re probably feeling like it’s hard to know what to budget for. And that can be a bit scary. You’ll have the mortgage, home insurance, and maintenance to think about – maybe even lawn care or homeowner’s association (HOA) fees. It’s easy to let the dollar signs be overwhelming. As Zillow says:
The important thing is to focus on what you can control. By partnering with a local agent and a trusted lender, you can get a clear understanding of what you can borrow for your home loan, what your monthly payment would be, and how your mortgage rate can impact it. And since that payment will likely be your biggest recurring expense, the key is to make sure the number works for you.
Don’t Stress About Repairs
The maintenance and repairs? Those can be a little bit harder to anticipate. But don’t forget you’ll get an inspection during the homebuying process to give you a better look at the condition of your future house. And with your inspection report in hand, you’ll have a good idea of what needs work. This way, you can start saving up so that you’re ready if and when something breaks.
But even then, if this is something that’s still really nagging at you, talk to your agent about asking the seller to throw in a home warranty. Those can cover repairs for some of the bigger systems in the house, like the HVAC, if they break within a specific time frame. While this isn’t a huge expense for the seller, the likelihood of a seller agreeing to one depends on what’s happening in your local market and how competitive it is right now.
It’s Okay To Stretch – Just Not Too Far
And remember, chances are that money will be a little tight – at least at first. And that’s kind of to be expected. A lot of times when someone buys their first home, they cut down on things like shopping and eating out for a while until they get a better idea of how their expenses will shake out in the new home.
But if you’re crunching the numbers and you won’t have enough money left for things like gas, food, etc. – it’s a sign you’d be stretching yourself too far. The last thing you want is to take on a payment that’s too much to handle. But stretching a little? That’s different. That’s normal.
Your Job Will Probably Change – And That’s Okay
And don’t forget, you’ll likely earn more down the road, so that slight stretch now won’t seem so bad as time wears on. As you advance in your career, you’ll probably start to make more money too. So, as your paycheck grows, the payments will get easier. Renting is a short-term option – and it’s one you deserve to get out of. Buying a home is a long-term play.
And just in case you’re worried about what happens if you do lose your job, you should know there are options, like forbearance, designed to help you temporarily pause payments on your home loan due to hardship.
Bottom Line
Buying your first home is a big decision, and it’s okay to feel a little nervous about it. But if you’re financially ready, don’t let fear keep you from moving forward. These emotions are normal, and Stovall Team helps our buyers get through them.
What makes you nervous when you think about buying your first home?
Connect with Stovall Team today so you have an expert on your side to explain everything along the way.