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“Focus on design, not on expensive materials or high-cost green features. Just building small is already being very efficient, economical, and green.” –Susan Eliot
Susan Eliot first learned about ADUs through her friend Jill at “Life-After-Life,” a group for women nearing retirement.
Jill had just converted her garage into an ADU and was renting her main house as a source of income into her later years. Jill’s ADU: A Home of Her Own was on the ADU Tour in 2013.
Susan also was looking to create financial freedom for herself as a single, retired woman. The idea of going into retirement with no mortgage payment – by having the rent from the main house cover the mortgage on both the main house and ADU – was very appealing.
Susan was inspired by Jill’s ADU, so her original plan was to do a garage conversion as her friend had done. However, in Kol Peterson’s ADU Class for Homeowners, Susan learned that garage conversions can require a complete rebuild because garage foundations are often inadequate to support an ADU structure. (Check out the Tips for Garage to ADU Conversions.)
“Kol discouraged us from converting a garage. With many garage conversions, you have to scrape it off and start over. So if I’m going to start over, I’ll look for a place to buy with a big backyard to build my ADU in instead.” –Susan Eliot
Susan’s main criteria was finding a property with a very rentable main house. After doing some rental market research, she realized that the rental income required for financial freedom had to come from a well-maintained three-bedroom, two-bath house.
Portland had a requirement that a detached ADU match the look of the primary dwelling. (This changed slightly in December 2015 when the Accessory Structures Zoning Code Update Passed.) Since Susan wasn’t sure which house she’d end up buying, she didn’t know what her ADU might look like. She was trying not to go into her ADU design process with preconceived notions.
Susan eventually found the perfect house on the perfect lot in the Woodstock neighborhood in Southeast Portland. The house was a three bedroom, one bathroom fixer-upper that sat at the front of a deep lot. Susan did a complete renovation of the main house and added a second bath.
“The house I bought has a steep roof and I like flat roofs, so at first I thought I would have done it differently if I could. In retrospect I probably wouldn’t do it differently. Because I had to have such a high-pitched roof, it created some really comfortable space on my second floor using dormers. That flat-roofed house that I thought I wanted wouldn’t have had that character. I didn’t feel stifled by the requirements. I liked that there would be some continuity between the two buildings.” –Susan Eliot
Susan contracted with Dennis Myers of Lifespace Design to develop the design for her ADU. As they worked through her design considerations she identified two big criteria: natural light and a home office.
“Almost every house I’ve owned has had good southern exposure. It’s especially important to maximize light in Oregon in the winter time, especially for someone like me who tends to suffer from SADD. That’s why I’ve got 23 windows and south facing living spaces. I also needed to have an office space because I’m self-employed. My public space – kitchen and living area – is on the main floor and private space – bath and bedroom – on the top floor. My office is halfway in between, off the stair landing.” –Susan Eliot
As Susan and Dennis developed the design, they paid particular attention to simple design decisions that would make the house resource-efficient.
“My water heater is right next to my laundry and bathroom and right above my kitchen so we have short plumbing runs. The hot water is almost instant, even though it’s not an on-demand water heater. The showerhead and toilet are low-flow. The house is also easy to keep clean with hardwood floors.” –Susan Eliot
Susan and Dennis were also very thoughtful about using her space efficiently.
“The little nooks and crannies came about because I’ve read Sarah Susanka’s books, The Not Big House collection. It’s all about creating a quality home using every inch of space very wisely. I pushed my builder and my designer to work at their highest potential to bring this all about. My designer had only designed and built 3,000 square foot houses previously. I assured him ‘You can do this. Let’s look at it this way. Let’s try the tub here. Let’s try the dormer here.’ I wanted the bathroom to be accessible to someone to come upstairs and use it without going through my bedroom. I pushed all three of us to the edge of our ability to be challenged. That’s why the house works so well. We didn’t just say ‘That’s not how it’s usually done.’ Instead we said ‘This is possible. We just have to figure out the puzzle.’” –Susan Eliot
Susan notes that her design considerations were different than they would have been if she were creating the space to rent to someone else. (Check out Options for ADU Owners: Rent One, Both, or Neither.)
“Because I knew I was going to live in this space I thought about it a lot more. People came in during the ADU Tour and said ‘This feels so homey. I think it’s because I’m one of only two people on the tour who are actually living in it.’” –Susan Eliot
[Many of the ADUs featured on the ADU Tours are short-term rentals or guest houses because those spaces are easier to make available for viewing by a thousand visitors on a single day. Homeowners who are renting their ADUs to long-term tenants don’t want to displace their tenants to share the space with a stream of ADU enthusiasts!]
Susan’s greatest challenge in building her ADU was financing it.
“Financing was a challenge because I had only been in the main house for a few months before I wanted to start the ADU. If I’d been in the house for a year, I could have gotten a Fannie Mae construction loan. Instead I had to find a private lender. The total cost was $115,000 and I had some cash to put toward it, so I got a private loan for $65,000. I also ran up my Home Depot and Lowe’s credit cards buying appliances and flooring. There aren’t a lot of banks that support ADUs, so you have to get creative with the financing.” –Susan Eliot
(For more about ADU financials, check out The Triple Whammy of ADU Financials.)
Susan hired Rob Bilyeu of Bilyeu Construction as her builder. Living in the main house enabled her to be on site every single day and share in the small decisions that need to be made on a daily basis.
“This was the only project my builder had at the time. He was here every day from 9-5 every day. I feel a lot of ownership rather than someone build it for me and hand it over. Everything went so well. From the day we broke ground until the day I received my Certificate of Occupancy was only three months and one week.” –Susan Eliot
Susan is now living in her ADU and renting out the primary dwelling as she planned. She began renting the main house for $2,300 per month immediately after moving into her ADU. She enjoys having her tenants in the main house and she intends to continue using her property this way for the foreseeable future.
“They are a professional couple with a baby. They’re lovely! I have a formal rental agreement with them. They give me a check on the first of every month. They seem to be very happy. It was hard for them to find a suitable rental when they moved here from North Carolina. In placing the ADU on the lot, I was intentional about providing enough space from the main house and installing a privacy fence that created separate yards for each of us. I don’t live any closer to them than I do to neighbors on either side.” –Susan Eliot
For her part, Susan is enjoying her ADU and she doesn’t mind a bit that she has a slightly smaller home than she used to.
“Everyone asks about storage. People say ‘I love your place, but would need another room for storage.’ There probably isn’t enough storage for the average person, but I’m a minimalist so I don’t have much stuff. That makes it a lot easier to think about living in an ADU. I don’t feel like I’m giving up anything. Instead, I feel I’ve gained a beautiful living space that is easy to care for and doesn’t burden me with a large mortgage payment. I feel so free. The ADU has allowed me to retire early so I can spend lots of time tango dancing and traveling and being with family and friends.”
(Check out ADU Storage Solutions for tips on how to maximize storage if you’re not as much a minimalist as Susan!)
Susan’s biggest surprise has been how quiet her ADU is since she’s located at the back of her 160-foot-deep lot.
“I’m surprised how quiet and private it is in the ADU, while still being in the city. I will also be adding lush landscaping over the next year to turn the yard into a backyard habitat for birds. My ADU turned out way better than I imagined looking at the two-dimensional blueprint. I never had a three-dimensional sense of how it was going to be. It’s just so special. Every day I love it.” –Susan Eliot
Susan moved into her ADU in the summer of 2015, so at the time of writing she was still determining how well the ADU was performing from an energy-efficiency standpoint.
“I have two small ductless mini-split heat pumps, all LED lights throughout, and the windows are energy-efficient. My electric bill for October was $41 and for November, when he had several days in the low 30’s, only $67. I get a bit of passive solar heat from the southern exposure. On the other hand, this summer when it was so hot, I wouldn’t need to turn on the AC until about 3:00 in afternoon. The big walnut tree out front that we were able to build around really helps.” –Susan Eliot
Susan is most proud of the way her light-filled ADU has balanced privacy with a connection with the outdoors.
“It’s the light and all the windows that face south. That makes the ADU. Once I get the landscaping in it will be like a little cottage set in a garden. That was always my vision. I’ll be able to look out and see vegetation and birds through all the windows.” –Susan Eliot
When asked what she would do differently if she had it to do all over again, Susan had to stop and think for a while.
“I might have reduced the size of the kitchen a little bit to make it a galley kitchen. That might have given me a little more dining space. But I’ve been thinking about this for so long, it was really thoughtfully done. I got to make all the little changes that I wanted to along the way so really have no regrets.” –Susan Eliot
So what advice does Susan have for homeowners considering creating an ADU on their own property?
“There are a lot of people who came through on the ADU Tour who just needed some inspiration. They just need to see someone go forward and do it. But my main piece of advice is to have a big picture or an overall goal in mind. And to keep your eye on the prize at all times. You have to be clear about why you’re doing this to have the determination and stamina to follow through and make hard decisions, sometimes letting go of a unique design feature or choosing a different material that allows you to stay within budget. I knew this was creating financial freedom and that’s what kept me going. Also, you need to be able to make a lot of decisions and make them quickly. Some people get stuck in analysis paralysis. They won’t all be perfect decisions but you can’t get stuck sweating the small stuff. You have to start with a good design, good people working for you, and just keep moving forward.” –Susan Eliot
When I asked Susan if she had any parting thoughts, she shared this fascinating insight from her experience showing off her ADU on the ADU Tour:
“During the tour a lot of people had one question: ‘I really like your place, but you have the lowest cost per square foot. How did you build this wonderful place at a lower cost than so many of the others that I don’t really like as much?’ As I though about how I would answer their question I realized that I don’t have any fancy features like glass shower doors or really pretty countertops or cork floors or cherry cabinets or expensive fixtures. Everything came from Home Depot, Lowes, or Ikea. The windows are vinyl. Everything is very basic. I know it’s possible to do this on a modest budget, but you have to give up the fancy stuff and instead focus on design and how your space is arranged and how you want to live in it. It’s all about having a great design. You can also add expensive features later.” –Susan Eliot
Wow, I love the light! This seems like a great example of how having a clear purpose in mind really clarifies the project. From the selection of the property to the market research about rents to the short plumbing runs, everything seems well thought-out — which is doubly important if it’s part of the retirement plan.
Thanks for your comment, Martin! I was equally impressed by how well-thought-out Susan’s home is. Once I saw it on the ADU Tour, I knew I had to help her share it with other people who couldn’t visit on the tour! So glad we had that opportunity!
What a delightful space you have created. Impressive.
Thank you Glen. It continues to delight me each day. I almost feel like I’m living in a resort cottage at times! There’s something very special about living in a place you’ve designed yourself….kind of like bringing what’s inside me into view for others to know.
Even with very basic materials, fixtures and finishes this cost seems very very low. 115,000 is well below any cost estimate we have had for our ADU designs, and we aren’t including anything crazy expensive. I wonder if the contractor offered some sort of discount or the client did any of the work herself. Most ADUs are coming in at 35,000 to 60,000 above that number.
Thanks for your comment, Lucas! Susan and her designer and contractor were very deliberate about keeping costs low throughout the project. Pretty impressive feat, isn’t it?
Besides purchasing all appliances, flooring, and fixtures from Home Depot, Lowes, or IKEA, timing was also in my favor. Building and building supply costs have definitely gone up since I built last January (2015) and subcontractors are learning they can charge premium rates for working on small projects (because of the potential wasted time and high demand for their services). Also, my builder and designer tell me that, in comparing themselves to other professional ADU creators, they realized that their fees were very economical. To give you a little better idea, I have included here a gross cost break-down that I shared with others on the tour. Hope this helps.
Survey (partial) $300
Foundation and Excavation $5,500
Owner labor (legwork, painting) $7,400
TOTAL $115, 003
I moved into my finished ADU in 2008.
It is located below the single family dwelling house.
Essentially daylight basement.
I am very pleased with the finished product.
My current goal is to refinance my house to something below 6.25%.
Has anyone been able to successfully have their rental income be seen as legitimate income?, for the purposes of refinancing?
So far, ADU income is not seen as legitimate income.
Waiting for good news,
I just refinanced with LoneStar bank and my ADU income was factored in. I would give them a call to see if they can help you. you can contact Andrea at LoanStar and tell her I referred you:
Andrea N Shaw
We also were inspired by your home on the ADU tour. I was not at all surprised to see The Not So Big House book on your coffee table. The thoughtful design shone through in every part of your home Thanks for being so willing to share your experience and learnings with those of us deciding whether to take the next step with an ADU!
Beautiful! Thank you for sharing all your information. I want to build one just like it! Really.
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Love your house. Is there anyway to get the design plans you used? Have you thought of selling those online. That is the nicest place I have seen and I have been looking for 2 years.
Hi Carter, the designer’s name and link are in the post.
In general this site gets a fair number of requests for design drawings. However, in my experience most of the ADUs people love are individualistic affairs. Partly what makes good designs good is that they are adapted to the places they are in — windows face things worth looking at, for example. So it’s hard to take even the most brilliant design and simply move it. Hopefully you can get some great ideas from what Susan and her designer have done!
My designer has already designed (and is in the process of building) another ADU using my floor plan, only larger (800 sf) with a slightly different kitchen configuration. You can contact Dennis directly at 503-246-3038.
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Thanks so much for the post – beautiful ADU, as everyone else has pointed out as well :-). One quick question: do you recall the overall footprint for the structure? That is, I can see the square footage here, but wondering about the measurements of the foundations/perimeter.
Thanks so much in advance
Hi John. Thanks for your favorable feedback. I don’t know exactly but I believe the footprint is about 320.