Building an Accessory Dwelling Unit (ADU) in Portland is a significant investment that can provide substantial returns through increased property value and potential rental income. This comprehensive guide breaks down the costs associated with ADU construction in Portland to help you budget effectively.
Average Total Costs by ADU Type
The first consideration is what type of ADU you plan to build. Here are the typical cost ranges for different ADU types in Portland:
- New Detached ADU: $200,000 - $400,000 ($250-$400 per square foot)
- Garage Conversion: $90,000 - $150,000 ($150-$250 per square foot)
- Basement Conversion: $75,000 - $150,000 ($125-$200 per square foot)
- Attached ADU Addition: $150,000 - $300,000 ($200-$350 per square foot)
Note that these ranges reflect 2025 construction costs in Portland, which have increased significantly in recent years due to material costs and labor shortages.
Pre-Construction Costs
Design and Planning: $5,000 - $25,000
- Architectural design: $5,000 - $15,000
- Structural engineering: $2,000 - $5,000
- Energy modeling: $500 - $1,500
- Site survey: $800 - $2,000
- Soil testing (if required): $1,000 - $3,000
Permits and Fees: $5,000 - $20,000
- Building permit: $2,000 - $5,000 (based on valuation)
- Plan review fees: $1,000 - $3,000
- System Development Charges (SDCs): $0 - $15,000 (can be waived with 10-year no short-term rental agreement)
- Metro Construction Excise Tax: $400 - $800 (based on square footage)
- School Construction Excise Tax: $1 per square foot
Site Preparation Costs
Site Work: $5,000 - $30,000
- Demolition (if needed): $5,000 - $15,000
- Excavation: $3,000 - $10,000
- Tree removal (if needed): $1,000 - $5,000 per tree
- Grading: $1,000 - $5,000
Foundation: $15,000 - $40,000
- Concrete foundation: $15,000 - $30,000
- Additional costs for hillside lots: $5,000 - $15,000
- Foundation waterproofing: $2,000 - $5,000
Construction Costs Breakdown
Shell Construction: $60,000 - $120,000
- Framing: $25,000 - $50,000
- Roofing: $8,000 - $20,000
- Windows and exterior doors: $10,000 - $25,000
- Siding and exterior finishes: $15,000 - $30,000
- Insulation: $5,000 - $10,000
Systems: $35,000 - $70,000
- Electrical: $10,000 - $20,000
- Plumbing: $10,000 - $25,000
- HVAC: $8,000 - $20,000
- Utility connections: $5,000 - $15,000
Interior Finishes: $40,000 - $80,000
- Drywall and painting: $8,000 - $15,000
- Flooring: $6,000 - $15,000
- Kitchen: $12,000 - $25,000
- Bathroom(s): $10,000 - $20,000
- Cabinetry and built-ins: $5,000 - $15,000
- Interior doors and trim: $3,000 - $8,000
- Appliances: $3,000 - $10,000
Additional Costs to Consider
Landscaping: $5,000 - $15,000
- Pathway to ADU: $1,000 - $3,000
- Plantings and irrigation: $2,000 - $8,000
- Fencing for privacy: $2,000 - $6,000
Project Management: $15,000 - $40,000
- General contractor fees: 15-20% of total project cost
- Project oversight: $5,000 - $15,000 if hiring a separate project manager
Contingency: $15,000 - $40,000
Experts recommend budgeting 10-15% of your total project cost as contingency for unexpected expenses, which are common in construction projects.
Ways to Save on Your Portland ADU
Cost-Saving Strategies:
- Convert existing space: Garage or basement conversions are typically 30-50% less expensive than new construction
- Consider prefab or modular options: Can save 10-20% compared to stick-built construction
- Simplify the design: Square or rectangular footprints with simple rooflines cost less
- Standard sizing: Using standard material dimensions reduces waste and labor
- Open floor plans: Fewer interior walls reduce framing and finishing costs
- Waive SDCs: Agree to the 10-year no short-term rental provision
- Energy incentives: Explore Energy Trust of Oregon incentives for energy-efficient construction
Return on Investment
While ADU construction represents a significant investment, Portland homeowners typically see strong returns:
- Property Value Increase: 60-70% of construction costs typically added to home value
- Rental Income: $1,500 - $2,500 monthly for a well-designed ADU in most Portland neighborhoods
- Break-even point: Typically 7-10 years when using the ADU as a rental
Financing Your Portland ADU
Several financing options are available for Portland homeowners:
- Home Equity Line of Credit (HELOC): Often the most accessible option
- Cash-out Refinance: May offer better rates but resets your primary mortgage
- Construction Loans: Specifically designed for building projects
- ADU-specific loans: Some lenders offer products specifically for ADU construction
- Portland Clean Energy Fund: Grants available for energy-efficient ADUs in certain circumstances
Getting Accurate Cost Estimates
The most reliable way to understand costs for your specific project is to work with experienced ADU professionals. At Portland ADU, we offer detailed cost estimation services tailored to your property and needs. Contact us for a consultation to get accurate figures for your planned ADU project.
