Is Spending $30K on a Basement ADU Worth It?
What does it cost to build a kitchen in your basement?  Investors interested in creating an additional income suite on their property need to know what it takes to create this space.  I recently took the first few steps to making an Accessory Dwelling Unit (ADU) in the basement of my house.  

There are a lot of considerations that go into getting an approved ADU, but today we’re just focusing on the buildout itself.

Two Learning Options!
  1. Watch the YouTube video (at the bottom.)
  2. Read the blog post. Note, the blog is an executive summary. Get the in-depth breakdown from the video.

Making the Decision to Build an ADU

We completed the buildout when the property was still the primary residence for my family and me.  It’s a house in Centennial that has a great but dated basement space.  The main area we wanted to change was the ugly laundry room and a dry bar with 1960s-era wood paneling we referred to as the “tiki bar.”

My husband and I wanted a more functional space to entertain, give guests a comfortable place to stay, and give ourselves more options of what to do with the space when we moved out.

Because we didn’t need to go into the basement on a daily basis, we knew the project wouldn’t have a huge impact on our everyday lives. 

Finding a Contractor to Build the ADU

It’s important to have an idea of how you want the space to look before hiring a contractor to do the work.  This ensures you’re both on the same page going into the project.  Plus, most contractors aren’t designers, and they’ll likely just be able to let you know why they can’t do something in your plan. 

Hand drawn plan for the basement ADU
Hand drawn plan for the contractor to use

Even though there’s a high demand for contractors right now, we didn’t have a hard time finding one to do the build.  We interviewed a few different people and were aware that this would be a side project for them.  This meant they would be coming in on afternoons and weekends and the project would take longer. 

Kitchen in the middle of renovation; cabinets with no counter and stove
Progress photo taken mid-renovation

Looking back, I would set clearer expectations and a timeline with the contractor before starting the project.

What Does It Cost to Build Out a Basement ADU?

Spreadsheet screenshot of the Basement ADU Costs
Cost breakdown of the buildout

In addition to the kitchenette, we also redesigned the laundry room, installed a new electrical panel, and added two egress windows. 

In order to make the two bedrooms in the basement up to code, we decided to convert the smaller windows into larger egress windows.  This makes them legal bedrooms and allows anyone staying in them to have a way to exit the room in case of emergency.  Anyone who wants to create a living space in their basement should invest in these windows. 

Egress windows tend to be a few thousand dollars because the contractors have to drill into the foundation of the house and cut the windows out of the concrete. 

In all, we spent $25K and the project took 6 months to complete.  If we wanted to completely separate the basement from the rest of the house to create an income producing unit, it would cost another $5K. 

So, Is it Worth It?

Completed ADU basement build; kitchen area
Completed kitchen

In the end, the space looks a lot more modern and is way more functional than it used to be.  Now, we have the option to rent it separately, giving us more income.  If anyone is on the fence about whether they should build a basement ADU, I encourage them to run the numbers and figure out what it would cost and how much they could get in rent.  I think you’ll be pleasantly surprised. 

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If you have any questions about the project, or want help figuring out your investment strategy, reach out to us for a free consultation

YouTube Video

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Investor Friendly Realtor | Investor | Host of the Denver Real Estate Investing Podcast
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