I Thought I Wanted a Single-Family Home. Turns Out, I Missed the Rental Income

Then, in August 2024, Massachusetts enacted a new law to encourage homeowners to build accessory dwelling units (ADUs), or in-law apartments, to ease the state’s housing shortage. These secondary, self-contained living spaces, complete with kitchens and bathrooms, can house extended family members or paying tenants.

My wife and I immediately knew this could be the solution we’d been looking for. Instead of moving to a two-family home, we could add a small apartment to our existing home. We considered our options and decided that converting a portion of our house into a one-bedroom apartment was the most cost-effective. 

We researched town and state ordinances and building codes, then applied for a building permit and submitted plans for the proposed project. Because we weren’t changing the footprint of our home, the process went very smoothly. We started the work in August and had everything completed and inspected by December 2024. We received a certificate of occupancy from the town, and our first tenant moved in on January 1, 2025.

Nearly two years later, we have absolutely no regrets about our ADU conversion project. The rental income has been a fantastic addition to our monthly budget, and we’ve had amazing tenants from the start. It has been the missing piece of our dream home and is making a more secure financial future possible for our family.

Tips for Adding an ADU: IsIt Worth It?

If you’re considering adding an ADU to your home or property, here are a few things to keep in mind:

• Check state and local laws:Start by researching your town or city’s ordinances and regulations to determine whether adding an ADU is allowed.
• Assess costs versus income:Our project cost around $55,000, and we currently collect $1,725 each month, or $20,700 per year, in rent. At that rate, it will take us about two and a half years to recoup the project’s cost. For us, it was well worth the investment.
• Consult an electrician early:I was surprised by the need to upgrade our electrical panel. If you’re considering a similar project, consult an electrician early in the process to assess your current electrical capacity and determine what upgrades might be necessary.
• Plan carefully:Consider your privacy and make it a priority when planning your ADU. Do you want to see your tenant every time you walk to your car or relax in your yard? Think about how your daily life and use of your property might change once the ADU is occupied.
• Make sure you’re ready to be a landlord:My wife and I had been landlords for 15 years when we began this project. We knew what we were getting into and how to make it a positive experience. There are plenty of stories about nightmare tenants and nasty evictions, and trust me, you don’t want to end up in a situation like that, especially in your own home.

A Better Investment

While we had been happy in a two-family home, we mistakenly thought we could do better. But after moving into what was supposed to be our perfect, single-family home, we realized we had made a mistake. Our “dream” house began to feel like a financial burden that only sucked up money and never gave anything back. Staying put and adding a small apartment has given us so much more breathing room and transformed our forever home from a burden into a boon. 

• Why Do Houses All Look the Same Now—And Why Are They All White?
• Everyone Said Black Kitchen Cabinets Were Too Bold. I’d Choose Them Again in a Heartbeat
• Why I’m Adding a “95% Day” to Every DIY Project From Now On