Step 4 Continued: Budget

How Do I Budget and Finance an ADU?

It's important to understand how to budget for and finance an ADU after knowing the costs and fees associated with designing and building an ADU. Below is an example budget worksheet and financial calculator to understand the potential costs and revenue of an ADU to better plan and budget. Microsoft Excel is required to use the worksheet and calculator.


ADUs typically offer a great return on investment in the form of additional income from renting the unit, or even a significant boost to your property’s value. There are many tools available online to help you understand the financial benefits of owning an ADU.

Lending Options

ADU Grant Opportunity 

The CalHFA ADU Grant Program offers up to $40,000 to reimburse pre-development and non-recurring closing costs associated with the construction of an ADU. The income limit to apply for the Sacramento area is $202,000 (2022). Click the below button to learn more!

There are several options to finance your ADU and include:

  • Cash-out refinance

  • Home Equity Line of Credit (HELOC)

  • Second mortgage

  • Construction & Renovation Loans

  • Existing cash/assets

To learn more about financing your ADU, see the ADU Finance Guide produced by the Casita Coalition.

Step 5: Development Application Submittal

You're ready for Step 5! Learn more about submitting a Development Application.