Feasibility before design
Before plans get drawn, we run a feasibility pass: zoning lookup, setback math, lot coverage and floor area calcs, sewer lateral check, utility capacity (200A panel headroom for a typical detached ADU), fire access path, and any HOA or historic-district overlays. This takes about a week and runs $0 to $2,500 depending on complexity.
Most San Jose lots will support a 700–1,200 sqft detached ADU under state ADU law. Garage conversions are even simpler since the footprint already exists.
Detached, garage conversion, or JADU
State law recognizes three flavors of accessory unit, and the right choice changes the numbers and the timeline dramatically:
- Detached ADU: A standalone structure up to 1,200 sqft, no lot-coverage restriction under state law. The most expensive option ($600–$900/sqft built), but the highest rent and the cleanest separation from the main house. Best for backyards with usable space and homeowners playing a long rental game.
- Garage conversion ADU: Re-purposes the existing footprint, typically 240–480 sqft. Cheapest path ($130–$260K all-in) because the foundation, walls, and roof exist. The trade-off is losing covered parking, which can affect resale in some neighborhoods.
- JADU (Junior ADU): Up to 500 sqft carved out of the existing primary residence, sharing a wall and entrance. Requires owner-occupancy of either the JADU or the main house. Cheapest scope ($80–$150K) but the smallest rent and tightest legal constraints.
All three paths are valid. The right one depends on lot, budget, family plans, and whether you intend to ever sell.
Design and structural
Design takes 4–8 weeks for a typical ADU: floor plan, elevations, structural engineering, Title-24 energy calcs, MEP layouts. We work with two licensed designers depending on the lot constraints and your aesthetic preference. Structural is sub-ed to a third-party engineer to keep the permit reviewer happy.
Smart selections at this stage save real money downstream. A standard 30x40 foundation footprint with a simple gable roof permits faster, builds faster, and rents at the same rate as a more complex shape. Save the architectural moves for the interior.
Real cost ranges in San Jose, 2026
For budgeting purposes, here's what the line items typically run for a detached ADU in our market:
- Soft costs (design, engineering, permits, fees): $25–$45K. School-impact fees and plan check fees alone can clear $10K on a 1,000 sqft unit.
- Foundation and site work: $40–$70K depending on access, slope, and whether trenching for utilities is short or long.
- Shell (framing, roof, exterior, windows, doors): $90–$140K for a 700–900 sqft unit.
- MEP (plumbing, electrical, HVAC): $40–$65K, including the sub-panel and tying into the main service.
- Interiors (insulation, drywall, flooring, kitchen, bath, paint, trim): $90–$160K depending on finish level.
- Landscape, fencing, and final site: $15–$35K.
Total for an 800 sqft detached ADU lands at $450–$650K in 2026 South Bay. Costs in nearby Santa Clara and Mountain View run 10–15% higher.
How homeowners finance the build
Cash is rare. The four common paths:
- HELOC on the primary residence: The most common. Variable-rate, draws as needed during construction. Best if you have substantial equity and intend to pay down quickly.
- Cash-out refinance: Replaces the existing mortgage with a larger one. Less attractive when current rates are above the homeowner's existing rate (the situation for most homeowners in 2026).
- Construction loan: Single-purpose loan that draws against project milestones, then converts to a permanent mortgage at completion. More paperwork, slower funding, but doesn't require existing equity.
- ADU-specific loans: A handful of credit unions and community lenders offer dedicated ADU products that underwrite against projected rental income. Newer, more limited, and worth shopping around.
Permit and plan check
San Jose's ADU plan check averages 60–90 days from submittal to permit issuance. State law caps it at 60 days for compliant submittals, but corrections add weeks. Plan-checkers want PG&E sign-off on service entrance, sewer lateral capacity confirmed, and Title-24 NRCC forms signed.
While plan check is running, we order long-lead items: windows, doors, the structural beam if there's a span over the garage, and any custom millwork. Lead times for windows in 2026 are 8–14 weeks; ordering during plan check keeps the build moving.
Plan-check corrections that cause delays
The corrections that show up most often, in rough order of frequency:
- Title-24 energy calcs missing or out of date: Forms expire, software versions change, and the building department wants the current cycle's submittal. The fix is fast if the designer is on top of it.
- Sewer lateral capacity questioned: The lateral from the main house to the city main is sometimes undersized for the additional fixtures. A camera scope plus a sign-off letter from a licensed plumber usually resolves it.
- Electrical service upgrade required: If the existing panel is 100A or 125A, an ADU usually pushes the math past capacity. Plan on a 200A upgrade as part of the scope.
- Fire access path width: The unit needs a clear 3-foot path from the street to the front door, sometimes 5 feet for larger units. Tight side yards trip this up.
- Drainage and grading: The site has to slope water away from the new structure and not onto neighbors. A simple grading plan resolves most cases.
Build and final
Build is 4–6 months for a typical detached ADU: foundation, framing, dry-in, MEP rough, drywall, finishes, exterior, and landscaping. Inspections happen at foundation, frame, MEP rough, insulation, drywall, and final.
Certificate of Occupancy comes after final inspection passes. From there it's typically 2–4 weeks to get a tenant moved in if the unit is listed at market rate. Total clean timeline from first sketch to rent: nine months.
Rental yield expectations
What an ADU actually rents for in 2026 South Bay:
- Garage conversion studio (240–380 sqft): $1,800–$2,400/month.
- 1-bedroom ADU (450–650 sqft): $2,400–$3,200/month.
- 2-bedroom ADU (800–1,100 sqft): $3,200–$4,200/month.
Rents vary by neighborhood and finish level. Willow Glen and Cambrian rent at the top of the range; further-east San Jose locations rent at the bottom. Furnished short-term rentals can earn 30–50% more gross but carry higher turnover, management, and vacancy costs.
Frequently asked questions
How long does the ADU permit process actually take?
Design and engineering run 4–8 weeks. Plan check in San Jose averages 60–90 days from submittal to permit issuance. From first sketch to permit in hand is usually 4–6 months.
Do I need to hire an architect for an ADU?
A licensed architect isn't strictly required for most ADUs, but a licensed designer or draftsperson is. Structural engineering (a separately sealed set of drawings) is required for any framed structure. Coordinating both is part of the typical GC scope.
What are the most common ADU permit corrections?
Missing or outdated Title-24 energy calcs, sewer lateral capacity questions, electrical service upgrade requirements, fire access path width, and setback measurements to the wrong reference. Each correction usually takes 1–3 weeks to resolve.
Can I rent out the ADU while permits are still open?
No. The Certificate of Occupancy comes only after final inspection passes. Renting a unit before final can create insurance, tax, and enforcement issues that far outweigh the few weeks of missed rent.
