ADUs are being built much more frequently now to help with both the housing shortage, and the high cost of living in California and other states. The rules for building them have been relaxed by increasing the number of units that can be built on a lot, reducing the amount of red tape in the permitting process, and even pre-approved City and County plans that both lower the cost of entry and expedite the approval process.
If you are looking to add some living space on your existing property for an in-laws quarters, a college kid coming home, an elderly family member that you would like to keep close by, or even as a rental, give us a call and we’ll come and see if your lot has the space needed to fit one in.
Let’s talk about the elephant in the room first: Anchored Tiny Homes. Anchored Tiny Homes came into the Sacramento ADU market in 2019 and exploded both in size (number of ADUs built or under contract) and scope (franchises sold throughout the country) but ended in a much-publicized trail of despair and financial ruin, culminating in their eventual bankruptcy filing in October of 2024, according to the Sacramento Bee article published October 4th, 2024.
What they left in their wake was a list of more than 870 creditors and more than $12.8 million dollars in debt, again, same article referenced above. To say that homeowners and sub-contractors should be both angry and cautious is an understatement. I personally know at least one roofer and one general contractor that were defrauded by them.
At TSD Construction we pride ourselves on not taking on too much work at a time, and always being able to pay our employees timely and subcontractors promptly. Paying bills on time and in full seems like good business, right? Yes. We should all strive to pay our bills in full and on time.
In an earlier article in the Sacramento Bee, dated August 20th, 2024, former Chief Officer of Operations for Anchored Tiny Homes Chris Pace is cited as saying that the financial struggles of the company were primarily the result of the company selling the projects at too low of a price, which resulted in subcontractors not getting paid on time. This is common (selling for too low to get the jobs on the books) in the construction industry and leads to problems down the road for a company’s solvency.
One of the first questions out of a potential customer’s mouth that I hear is, “how much per square foot” for an ADU that is 600 square feet, or 700 square feet, or whatever size. This is a faulty way to evaluate the value or cost of an ADU project, any construction project really. If a customer has a set of plans, then they should be able to get bids based on that specific set. If they don’t have plans, then they need to have a budget, or range, that they are going to be comfortable in. Realistic expectations need to be set in the beginning phases for a good outcome.
Some of the biggest costs of building a home are the plumbing for a kitchen and bath, and the electrical associated with that building. Some of those costs are fixed and some are variable, but what they have in common is that the fixed parts are spread or divided by the number of square feet. The smaller the unit, the higher the overall cost per square foot. Also to note, that building a single unit in a backyard has considerably higher costs than building a new home in a housing track where subcontractors are lined up in building order and able to be much more efficient with their time and resources. In short, comparing the cost per square foot for building an ADU and comparing current new home building prices is like comparing apples and oranges—they are not the same. Along that same train of thought is trying to compare costs in California to costs in Tennessee…even trying to compare Bay Area costs to Sacramento costs doesn’t work.
How can a homeowner protect themselves against getting ripped off or putting themselves in a bad situation with a contractor? The main way to protect yourself is to not pay for something that hasn’t been built yet. If a contractor has to ask you for money for materials, that’s not a good sign of the contractor’s solvency. At TSD Construction, we lay out an easy to understand and easy to keep track of payment schedule for ADUs. It might look something like this:
You get the point. Each completed task has a dollar value associated with it depending on what we are building for you, and you can see the completed task and feel comfortable making the payment. You will never be paying for something that you cannot touch and feel and see with your own eyes.
The other way to protect yourself is to do your homework on your contractor. Check reviews, ask your family, friends or neighbors, look at the CSLB “check a license” website for any complaints or citations, also making sure that they carry all the required insurances. If you hire a contractor that doesn’t have worker’s comp (that will show as “exempt” on the CSLB site) then they can’t legally have anyone working for them; they are still allowed to subcontract, but they can’t have any employees of their own. There are many small companies that are legitimately exempt, and there are also unscrupulous ones that claim to be exempt just to save money (and audit time) on workers comp.
Here are some pre-approved sets of plans from the City of Sacramento and the County of Sacramento, and the City of Elk Grove. There’s also a set of plans of a custom build we did in 2024. The pricing listed is to give you an idea of what it costs to build the project—this pricing will be adjusted each time the market warrants a change. Each job is different, and some of the finishing touches that you select will have an impact on the final price you pay. Here’s a list of some of the features that are included with all of our ADU builds:
What is NOT included in the numbers quoted below, are utility hook ups. Each lot is different, and each build is different, and each site will have to be quoted based on the ease or difficulty of bringing in water, power, and connecting to the sewer system. Finish landscape is also not included. We can manage that for you; I have a C-27 landscape license and have done about 400 yards over the years, but we are not currently doing landscape in-house.
Please keep in mind that we can build any of the models or any design you want, but the “ready to go” off the shelf plans from each municipality are only usable in that municipality. You can’t take Sacramento County ready to go plans to Elk Grove for example, or Elk Grove plans to Sacramento City.
Starting at $225,000
Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $228,000
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Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $248,000
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Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $320,000
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Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $209,000
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Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $348,000
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Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $439,000
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Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
Starting at $219,000
Pricing above is based on current market materials and labor costs. While we don’t expect labor to vary much, materials prices ebb and flow based on many variables like inflation, tariffs, supply issues, and time your project will be built. We will keep these prices as current as possible.
