A HomeReady Mortgage is a Fannie Mae, first-time home buyer loan program, with minimum down payment requirements, and some very particular underwriting characteristics. When a borrower is purchasing a single-unit primary residence with a 3% minimum down payment and there is an ADU present, 75% of the potential rents from the ADU can be used to qualify.
James Michelinie & Kyra Routon first learned about ADUs when they were house hunting as newlyweds. They’d been renting a house in the Alberta Arts District for the past two years and they were looking for a property they could afford in a neighborhood they loved. They ended up purchasing the house they were renting and building an ADU in the backyard, which they now live in.
Don Golden and his wife Edith Casterline built an ADU an unusually public place: their front yard. The new structure serves three main functions: generating rental income, giving Don the woodshop he wants, and bringing activity back to the street.
Lesa Dixon-Gray stumbled across ADUs as she was researching multigenerational housing options for herself and her aging mother. Lesa’s mom, Shirley, was having a difficult time deciding where she wanted to live, but knew she didn’t want to live in the same house as her children. Lesa realized she might be able to entice her mother to move to Portland by giving her a place of her own. As Lesa began searching for duplexes, she discovered ADUs and accessory structures.
Lisa took out a home equity line of credit to fund her basement ADU and supplemented it with a portion of each month’s income from her employment. However, many of the finishing touches were a labor of love. Lisa’s key design consideration was staying on budget while using creative design and décor to make it interesting.
John used a home equity line of credit (HELOC) and credit cards to turn his basement apartment into a permitted ADU. His primary design consideration was that he wanted the apartment to be a fully self-contained residence.
Financing ADUs has remained a major challenge. But, in the future, 2019 will always be thought of as the year of ADU financing innovation. On April 29th, Portland State University convened a meeting in Washington, D.C to help flesh out some of the innovative programs that are being developed to finance ADUs.
Quick links to the ADU project profiles 1) Justin Graham and Pam Statz 2) Christopher Wilson 3) Susan Moray 4) Mark and Terry Lewis 5) Robert and Margaret Spurlock 6) Matthew and Jennifer … Continue reading
This week’s ADU Case Study was written and contributed by Deborah Kelly, the owner of an ADU called Mossy Cobbles. Deborah worked with her son, Justin S. Kelly, who is an architect and engineer, to design the cottage for Deborah’s mother to occupy when she lived in Portland for half the year. It was constructed by the next door neighbor, Tony Kikes with hardscaping by another friend and neighbor, Steve Carruthers. The cottage is now available as a short-term rental.
Major design considerations for Natalie and Justin Strom included creating a feeling that their ADU is more like a single family home than an ADU and fitting the ADU into the aesthetic of the traditional neighborhood while bringing in modern elements in the interior. It was also important to Justin and Natalie that the design be flexible enough to allow for multiple use and that they utilize sustainable and energy efficient building materials and techniques.
Quick Facts Setting: urban Neighborhood: Rose City Park, Portland, OR Type: stand-alone detached unit (new construction) Use: owner’s residence Square Footage: 800 Year Built: 2015 Owners: Catherine Butler Designer: Dave Spitzer of ADU PDX … Continue reading
Readers of this series may have noticed a positive tone change in the dire title of the series. That’s because yesterday, the Oregon Department of Revenue issued a draft rule that steers Multnomah County away from the misguided interpretation that they’d used this year–the interpretation that had caused detached ADUs to trigger a property reassessment– the interpretation which has caused a dramatic ADU development chilling effect in Portland in the last 6 months.
Financing is, by far, the biggest barrier for most homeowners seeking to build an ADU on their property. Recently, I was trying to gain some clarification about three conventional loan products that can be used to help fund the construction of an ADU: First Mortgage Cash Out Refinance- taking out extra money when refinancing your ‘first mortgage’ .
Joan and Rita’s carve-out ADU entailed creating a new entry on the north side of their house, and separating the ADU from the main house by building a wall in the former hallway leading to an existing full bath and the underutilized bedroom. The kitchen-dining-living area is the located in the front of the original house with a large bank of windows offering natural daylight and garden views, and the more private bed and bath areas are located toward the back.
The old woodshop on Kathleen Pequeño’s property had “a sense of being useful.” It took a lot of work, but she turned it into a nice small house.
Dennis & Stephanie Martin’s ADU has helped their extended family stay together through life changes.
When Ellen’s new university professorship required relocation to Virginia, they had to make big decisions about their SE Portland property. They knew they wanted to ultimately return to their home in Portland and for the time-being they planned to return during academic breaks. It didn’t make sense to leave their beloved home vacant while they were gone. However, if they leased their property they would have no place to call home when they returned to Portland for the holidays. A little ADU solved the problem.
Stephen has always enjoyed the challenge of making a small space functional and comfortable. He had already built two ADUs, so it made sense that he would build an ADU on his own property when the opportunity arose. In 1998, Stephen purchased a lot in the Foster-Powell neighborhood with an existing house, which had been condemned. He remodeled the 1908 home and rented it out. He then designed an ADU for the back half of the lot, abutting the alley.
As she worked with Jack, Susan’s primary design consideration became maximizing the size of the ADU while adhering to Historic Neighborhood requirements. Prior to applying for her permits, Susan paid for a design consultation meeting with the city of Portland and Jack brought preliminary sketches to explore various possibilities.
My architect, Jack, did his homework on what could be built, given these limitations and nailed down a design that was accepted on the first try with no changes. That was impressive. We were told by everyone we would never get what he wanted past city permit without going through design review but he did. -Susan Moray
This post details some findings about ADU permit trends in Portland.
First, we’ll start with the big picture. Here’s the latest data on the number of permits issued by the City of Portland for ADUs from 2000-2018. In 2017, 588 permits were issued. In 2018, 660 were issued. This is a total of 1248 ADU permits issued in 2017 and 2018.
Quick links to the ADU project profiles 1) Mark Timby and Leighann Franson 2) Carissa Page 3) Megan and Matt Klepp 4) Brian Chodowski 5) Dan Batz and Anne Marie McClaran … Continue reading
The key factor that convinced Al and Shannon to build their own garage apartment was increasing their housing flexibility. They built the ADU first with the plan to eventually build a house on the front portion of the lot which would allow them the option of using the ADU as a potential income property. The ADU was constructed in 2013 and the primary dwelling in 2015.
I spent a lot of 2011 learning about Accessory Dwelling Units (also known as in-law units, granny flats, backyard cottages, etc). Beat that in terms of geekiness! (Okay, I bow … Continue reading