How Much Does It Cost to Build an ADU?

October 16, 2025
5 min read.

Ever since the City of Atlanta started allowing homeowners to build ADUs, or accessory dwelling units, on existing residential lots, these little houses have been cropping up in a lot of places. An ADU can be a great investment. It can also be a great way to create a comfortable and private space for family to stay, a studio space separate from your main house, an income generating rental, or all three. If you’re considering building a carriage house, or garage apartment, or in-law suite on your property, probably one of the first things you’ve thought about is – what does an ADU cost?

It’s important to remember that the prices you see here are for an entire project – not just construction costs, not the cost of a kit that needs to be assembled, but everything from initial site planning and design to the moment you walk into your little house with a certificate of occupancy in hand.

At Creative Carriage builders, we specialize in ADUs (and garage conversions). It’s what we do. We manage your project, understand your needs, and partner with a team of experts who professionally handle every step of the project. This includes surveying, site planning, design, permitting, site work, pouring the foundation, hooking up utilities, framing the structure, finishing, and even interior design.

You may have seen kits like this one with pretty appealing prices, but if you read the description you’ll see that these prices include only the framing for the house, no windows, no doors, no appliances, no interior or exterior finishes, no plumbing, no foundation. And you’ll still have to build everything yourself.

Even with a small house that’s completely prefabricated, you’ll still face the cost of transporting the house to your site, potentially having it craned into the backyard, and building a foundation and creating utility hookups. Plus you miss the opportunity to create a design that’s specifically tailored to your property and your needs.

Case #1 – A garage conversion

If you’re looking to get into the ADU game but are on a smaller budget, by far the most economical choice is to convert an existing garage into a livable, climate controlled space. Taking advantage of the existing foundation and framing is a huge money saver, although you’ll still need to add insulation, interior walls and finishes, and plumbing, if it doesn’t already exist. You’ll also need to get your plans approved and pull permits that allow the space to become a residential structure.

The current price we’re seeing for a full garage conversion is between 90 and 130k. Factors like whether your existing garage electrical, water, and sewer hookups can affect the price.

Case #2 – A studio or one bedroom ADU

Your personal needs or the size of your lot could be pointing you in the direction of a smaller ADU – something around 350 – 500 square feet. This smaller size can allow for a multipurpose studio, or a modestly sized one bedroom. These prices are taking into account a space with its own bathroom, so it can allow for long-term habitation. Creating a new building on your existing lot means bringing in more trades than a conversion – you ‘ll need to have a foundation poured, new framing, and entirely new plumbing and electric hookups.

The price we’re looking at for a smaller freestanding ADU like this one is 160-210k. Factors that will influence the price include how much work needs to be done to ready the site, and the size of the building you’re creating.

Case #3 – A larger (up to 2 bedroom) 2 story ADU

In the city of Atlanta the size limit for an accessory dwelling unit is 750 square feet. (Limits vary around the country, but in this case Atlanta has set it at 750.) This may seem small, if you’re used to looking at square footages, but it’s enough for a generous one bedroom or even a thoughtful, well designed two bedroom.

One thing to keep in mind is that if your new project adds more than 500 square feet of impervious surface to your lot, the City of Atlanta requires you to adhere to stormwater management standards for the addition, which has the potential to add significant extra expense to the project. Note that the 500 square foot limit is only for the building’s footprint (and any other impervious areas, like a walkway, you might add), so you can make an addition of more than 500 square feet if the building has two stories.

Our price range for a project like this is between 200 and 260k. Factors that affect the price could include how much site work has to be done, and features of the building like balconies and porches.

A good thing to remember when looking at all these numbers is that this is everything you will need- one number to go from ideation to completion. We strive to be a turnkey service, one where you can come to us with your ideas about what you want from an ADU, and we can turn that into a reality. You pay one price from concept to construction, from the moment you sign a contract to the moment your ADU is open and ready to house renters or friends.

If you’re interested in building an ADU in Atlanta, we’d love to talk with you about your project. You can use this form to get in touch with us and determine if our services are the right fit for you.