Your garage may hold the keys to a new rental opportunity
If you are looking for a way to create passive income, look no further than your own garage. You may be able to convert it to an accessory dwelling (UDA) that you can rent.
That’s what Amy O’Dorisio did. In 2019, the Coldwell Banker West realtor in San Diego spent $ 130,000 to convert a one-car garage on the property to a two-bedroom investment property to create an additional rental unit. Due to the high demand for affordable rentals in her market, especially among older people looking for one-story accommodation, Ms. O’Dorisio, now 40, has an income of 2,000. $ per month for ADU of one bedroom and one bathroom.
“The tenant is a woman in her 60s, and that’s part of the reason I decided to do it,” said Ms. O’Dorisio. “I knew there was an aging baby boomer population in San Diego.”
Ms. O’Dorisio’s business has been so successful that she is now considering building an ADU in another property she owns by adding a second story to an existing garage.
ADUs are growing in popularity, according to a national study published by Freddie Mac last year. Almost 70,000 properties with ADU were sold in 2019, the latest year for which statistics are available, representing 4.2% of total homes sold through MLS, compared to just 8,000 properties with ADU, or 1.1%, in 2000. Similarly, 8,000 ADU rentals were leased in 2019, up from less than 1,000 in 2000. Freddie Mac found that demand for ADUs is highest in rapidly growing areas of the country, such as California, Florida, Texas and Georgia.