The ADU
Investment
Playbook
Find the deal. Run the numbers. Fund the project.
The complete guide for real estate investors building wealth through accessory dwelling units.
Built for Investors
Who This Playbook Is For
Fix & Flip
Higher-margin strategy with ADU-driven forced appreciation and premium ARV.
Buy & Hold
Maximize rental income per property by adding a second income-producing unit.
BRRRR
Force appreciation through construction, refinance, and recycle your capital.
New Investors
Your first value-add project with a proven, repeatable framework.
Complete Framework
16 Chapters. Everything You Need.
From strategy selection to exit planning — each chapter is designed to be read independently or as part of the full playbook.
Strategy & Market Selection
Why ADUs, Why Now
The housing gap, policy tailwinds, Fannie Mae changes, and why ADU investing is one of the most compelling value-add strategies for real estate investors today.
The ADU Strategy Matrix
Compare five ADU strategies — garage conversion, shed conversion, ground-up build, JADU, and lot split — with costs, timelines, risk levels, and return profiles.
Market Selection Framework
A seven-factor scoring model to evaluate any market for ADU investment viability — regulatory environment, rent-to-cost ratio, lot availability, and more.
Finding & Underwriting Deals
Deal Sourcing & Underwriting
How to find ADU-viable properties on and off market, run a five-step feasibility screen, and underwrite flip, BRRRR, and rental scenarios in RISE.
Legislation & Regulatory Due Diligence
Federal, state, and local regulatory layers for ADU construction. A six-step research process and monitoring system to stay ahead of changing ADU laws.
Building Your Team & Project
Building Your ADU Power Team
The 10 professionals every ADU investor needs — lender, architect, GC, attorney, CPA, and more — with interview frameworks and vetting criteria.
Design & Construction
Build methods, floor plan principles, finish levels, permitting process, draw schedules, and budget management for ADU construction projects.
Financing Your ADU Project
Six financing options for ADU projects — cash, HELOC, cash-out refi, conventional construction, bridge loans, and DSCR — with the ADU financing lifecycle.
Protecting & Operating Your Investment
Insurance & Risk Management
Insurance coverage for every phase of an ADU project — builder's risk, general liability, landlord policies, umbrella, flood, and earthquake.
The Rental Playbook
Long-term, mid-term, and short-term rental strategies for ADU properties — setting rents, furnishing, tenant screening, and vacancy minimization.
Tax Strategy & Entity Structuring
Depreciation, cost segregation, Real Estate Professional Status, LLCs, land trusts, and 1031 exchanges for ADU investors.
Property Management for ADU Properties
Managing two units on one lot — shared spaces, utility metering, maintenance planning, tenant relations, and when to hire a property manager.
Exits, Lessons & Resources
Exit Strategies
Five exit strategies for ADU investments — hold for cash flow, sell post-stabilization, BRRRR, condo-map, and 1031 exchange — with RISE modeling.
Common Mistakes & Lessons from the Field
Ten preventable mistakes that kill ADU deals — permit timelines, impact fees, wrong contractor, over-building, and more — with prevention checklists.
Case Studies — Real Deals, Real Numbers
Four ADU case studies with full financials — garage conversion flip, ground-up hold, BRRRR, and a deal that didn't work — with RISE inputs and lessons.
Tools & Resources
RISE walkthrough, ADU cost estimator, pro forma template, permitting checklist, contractor questionnaire, ADU-readiness quiz, and glossary of terms.
Deal Analysis Tool
Ready to Run the Numbers?
RISE is the deal analyzer built by Revolution Realty Capital. Model any ADU scenario — fix & flip, ground-up, rental hold, or BRRRR — and see your returns instantly.
Open RISE →Interactive Assessment
Is Your Property ADU-Ready?
Answer 10 quick questions to find out if your property is a strong ADU candidate. Takes less than 2 minutes.
Take the Quiz