Unlocking the Potential of Accessory Dwelling Units in San Diego

What Is an ADU?

An ADU—sometimes called a granny flat, casita, or in-law suite—is a secondary living unit on your property. It can be:

• Attached to your main home (like a converted garage or basement).

• Detached as a standalone backyard home.

  
  

👉 In San Diego, ADUs are more than just extra space—they’re a solution to rising housing costs, offering homeowners rental income and long-term property appreciation. Studies show homes with ADUs can increase in value by up to 20%.

Step 1: Navigating the San Diego ADU Permitting Process

Permitting is the most critical part of any ADU project. Here’s a simplified roadmap:

1. Check Local Zoning Rules – San Diego ADU regulations vary by neighborhood.

2. Create Plans – Work with a licensed ADU contractor (like H&M) to design plans that meet city codes.

3. Submit Application – Plans are reviewed by the City’s Development Services Department.

4. Approval Time – Approvals can take weeks to months depending on complexity.

5. Secure Permits – Once approved, permits must be obtained before construction begins.

   
   

✅ Tip: Hiring an experienced contractor helps you avoid delays and costly mistakes.

Step 2: Understanding ADU Costs in San Diego

The cost of building an ADU depends on size, finishes, and site conditions. Here’s what to budget for:

• Design & Planning: $2,000 – $10,000

• Construction: $200 – $400 per sq. ft.

• Permits & Fees: $1,000 – $5,000

• Utilities & Site Prep: $10,000 – $20,000

  
  

👉 Example: A 500 sq. ft. ADU could cost $100,000 – $200,000 depending on finishes.

Step 3: Financing Options for Your ADU

Funding your project doesn’t have to be overwhelming. Homeowners commonly use:

• Home Equity Loans / HELOCs – Low rates, ideal if you have equity built up.

• FHA 203(k) Loans – Combine your mortgage + ADU project financing.

• Personal Loans – Best for smaller projects or upgrades.

• State & Local Incentives – California offers grants for certain ADU builds.

  
  

💡 Many H&M clients use equity loans because the rental income from the ADU often covers the payment.

Step 4: ADU Design Trends in 2025

San Diego homeowners are embracing modern design elements to maximize functionality and style:

• 🌱 Eco-Friendly Materials – Sustainable finishes are more popular than ever.

• 🏠 Open Floor Plans – Create spacious living in smaller footprints.

• 🔌 Smart Home Technology – Energy-efficient lighting & appliances.

• 🌴 Outdoor Integration – Sliding glass doors & patios for year-round sunshine.

  
  

These touches not only make your ADU livable but also more attractive for renters.

Step 5: Choosing the Right Contractor

Your contractor can make or break your ADU project. Here’s what to look for:

• ✅ Licensed & insured (CA Lic #1034196 – that’s us!)

• ✅ Local San Diego ADU experience

• ✅ Transparent quotes & contracts

• ✅ Strong communication throughout the project

  
  

At H&M, we handle design + permits + build, giving you a one-stop solution from start to finish.

Step 6: The Benefits of Building an ADU

Building an ADU offers numerous advantages. Here are some key benefits:

Increased Property Value

Adding an ADU can significantly increase your property’s value. This is especially true in desirable areas like San Diego, where housing demand is high.

Additional Income Stream

Renting out your ADU can provide a steady income. This extra cash flow can help cover your mortgage or fund other projects.

Flexibility for Family

An ADU can serve as a space for family members, providing them with independence while keeping them close.

Sustainable Living

ADUs can be designed with eco-friendly materials and energy-efficient systems, promoting sustainable living.

Step 7: Common Misconceptions About ADUs

Many homeowners have misconceptions about ADUs. Let’s clear up a few:

ADUs Are Too Expensive

While building an ADU requires an investment, many financing options are available. Plus, the potential rental income can offset costs.

ADUs Are Only for Rentals

While many people use ADUs as rental units, they can also serve as guest houses or spaces for family members.

Permitting Is Too Complicated

The permitting process can seem daunting, but working with an experienced contractor can simplify it greatly.

Ready to Build Your ADU?

Accessory Dwelling Units are one of the best ways to add value, flexibility, and income to your San Diego home. With the right planning, budget, and contractor, you can create a space that pays dividends for years to come.

📩 Download our Free 2025 San Diego ADU Guide here: https://www.hmsandiego.com/free2025sandiegoaduguide

📞 Or schedule your free consultation today: Contact Us

H&M Building Services – San Diego’s ADU Experts 📍 7413 El Cajon Blvd, La Mesa, CA 91942