Converting a garage into an Accessory Dwelling Unit (ADU) has become a popular move among homeowners and real estate investors alike. And it makes sense. With the rising cost of living, tight housing markets, and a need for flexible living spaces, an ADU provides both functionality and financial opportunity. But how much should you expect to spend on this type of project?
Let’s break it down.
Garage to ADU Conversion: Why It’s Gaining Popularity
Before we talk numbers, it’s important to understand why so many homeowners are going the ADU route. Converting a garage is one of the most efficient ways to add value to your property. It offers the potential for rental income, a private space for guests or aging family members, or even a dedicated office or creative studio. And because the structure already exists, you’re not starting from scratch—this can cut down significantly on construction time and costs.
More importantly, garage ADUs are a smart response to today’s housing challenges. In high-demand areas where adding new construction is difficult or expensive, repurposing a garage offers a more accessible entry point to expand usable space. With housing shortages in many urban and suburban communities, cities are encouraging these types of builds by easing zoning restrictions and offering incentives.
Homeowners are also seeing the flexibility of ADUs as a long-term solution. What starts as a rental unit today could become a home office tomorrow, or a comfortable in-law suite down the line. It’s a future-proof investment that adjusts as life changes.
And let’s not forget about the lifestyle upgrade. A well-designed ADU doesn’t just increase property value—it enhances how you use and experience your space every day.
The Big Question: How Much Does It Really Cost?
On average, the cost to convert a garage to an ADU ranges from $80,000 to $150,000. That’s a wide range, and here’s why: there are many variables involved. The size of your garage, its current condition, and your desired level of finish all play a role. Local zoning regulations and the complexity of plumbing, electrical, and HVAC work can further impact the final price.
No two garages are the same—some are move-in ready, while others may need significant structural upgrades. That’s why planning is key.
Breaking Down the Costs
Let’s take a closer look at where your investment goes.
Planning and permits typically cost between $5,000 and $15,000. You’ll need architectural plans, engineering approvals, and official permits from the city. Some areas have streamlined ADU programs, but others may involve a lengthier process.
Construction and framing can run from $20,000 to $40,000. This covers walls, insulation, structural repairs, and roofing. If the existing garage is in poor shape or doesn’t meet current codes, expect to pay more.
Plumbing and electrical work may add $10,000 to $20,000 to your budget. Adding a kitchen and bathroom is a significant part of any ADU conversion. If your garage isn’t already connected to main lines, additional trenching and hookups may be required.
Windows, doors, and insulation cost another $5,000 to $10,000. Garage doors are typically replaced with framed walls and insulated windows to ensure energy efficiency and comfort.
Interior finishes vary widely—from basic to high-end—and can range from $15,000 to $30,000. Flooring, cabinets, appliances, lighting, and paint all fall into this category. Your choices here will have a major impact on both cost and final appearance.
Heating and cooling systems usually require a budget of $3,000 to $10,000. Many homeowners choose ductless mini-split systems, which are cost-effective and energy-efficient.
Hidden Costs Homeowners Don’t Expect
There are some expenses that often catch homeowners off guard. These include utility connection fees for water, sewer, and electricity, as well as city-imposed impact fees. In some cases, changes to driveways or landscaping may be required to meet access or fire safety codes.
It’s wise to add a 10-15% contingency to your budget to cover any surprises that come up along the way. Unexpected structural issues, design changes, or inspection delays can all lead to increased costs.
Can a Garage Conversion Save You Money in the Long Run?
The answer is yes. While the upfront investment might feel steep, the long-term gains are often substantial. Many homeowners rent out their ADUs and earn between $1,500 and $3,000 per month. In many cases, that monthly income can cover the construction cost in just a few years.
Additionally, having a legal, permitted ADU can significantly boost your property’s resale value. Buyers appreciate the extra living space and income potential.
Is a Garage ADU Right for You?
That depends on your goals. If you’re looking to earn rental income, create a private space for extended family, or simply expand your home’s livable square footage, converting your garage might be the smartest investment you make this year.
It’s also one of the most creative ways to make use of underutilized space, especially in areas where land and housing are limited.
Beyond functionality, a garage ADU can give you the freedom to adapt your home to changing needs. A growing family, an aging parent, or even the need for a home office or studio space—these are just a few of the life moments that a converted garage can support.
It can also help you stay in your neighborhood, close to schools and work, without having to move to a larger property. With the right design and a good contractor, the space can feel just like any other part of the home—comfortable, private, and full of potential.
Ready to Start Your Garage Conversion?
At Ground Up Builders, we specialize in turning garages into stylish, fully functional ADUs that fit your lifestyle and increase your home’s value. From the initial consultation to the final coat of paint, we handle every step with experience, care, and attention to detail.
If you’re curious whether your garage is a good candidate or want to get a clear picture of what it would cost, we’d love to help.
Reach out today and let’s turn that empty garage into something incredible.