Most families feel concerns over how to take care of aging relatives. You may be unsure whether you can provide the level of care necessary, but nursing homes and assisted living can be costly. Enter “Granny Pods,” also called granny flats or accessory dwelling units (ADUs), which can give families a new option for caregiving while offering seniors a space to call their own.
As U.S. News reports, if you’re considering adding a Granny Pod to your property, here’s what you should know, so that you can make an informed decision for you, and your entire family.
What Are Granny Pods, Anyway?
Granny pods are small detached guest houses, typically found in the backyard of a home, that meet the needs of older adults. Similar to an in-law cottage or mother-in-law suite, granny pods are usually one level and include a bedroom, bathroom, living area and kitchenette. Granny pods are also built to be accessible and safe. For example, wide doorways to fit wheelchairs, soft flooring, room for handrails, rounded countertops and some may come with medical extras.
“Very little of our housing is designed for people of all ages. Demographic changes, lessons from COVID, the economy and cultural factors all lead to more people looking for multigenerational housing,” says Rodney Harrell, AARP vice president for family, home and community.
If your elderly relative needs some extra help but prefers to have their own space, then a granny pod may be a solution. While they aren’t very large – between 250 and 900 square feet – they include everything one needs to live independently. “As more and more people are looking for homes that can support family members of different generations, we must find ways to meet the need. Accessory dwelling units give homeowners the power to create more housing options in their own neighborhood, including the ability to create a space for their families,” Harrell adds.
Granny Pod Pros and Cons
Pros of Granny Pods
- Financial security: When it comes to multigenerational living, Genevieve Waterman, director of financial and economic security for the National Council on Aging, says it’s all about the financial benefits. Not only can the family share monthly costs like food, utilities and other basic expenses, but also big-ticket items like the mortgage and property taxes. “Property taxes are a big chunk of someone’s needed income and when you’re living on a fixed income, that’s very difficult to cover,” Waterman says. “(Granny pods are) another way to provide financial security for both the older adult and for the other generations that are trying to build wealth.”
- Daily interaction and support: “When you think about those that are aging, they typically become more isolated over the course of their life,” Waterman says. “And so, having multigenerational housing allows them to continue to have that daily interaction.”
- Better management of chronic conditions: According to the NCOA, 80% of older adults have at least one chronic condition. Family can often help chronically ill older adults manage their conditions.
- Independence: Granny pods allow seniors to live independently while allowing for prolonged aging-in-place.
- Better protection against scammers: “When we think about financial fraud and scams, the key driver to someone becoming a victim of a scam is social isolation,” Waterman notes. By having that connectedness, Waterman says there’s less of a chance of developing a relationship with a stranger online.
- Increase property value: A separate living space on your property could increase your property value by as much as 30%, according to HomeAdvisor.
Cons of Granny Pods
- Not enough space: Having a smaller space means there’s less room for items that may have been accumulated over many years. “If you’re someone who likes to have a lot of material possessions, these types of smaller housing might not be ideal for you,” Waterman advises.
- Large upfront cost: Building a granny pod requires a large amount of money upfront. Unless you have the cash, you may have to take out a loan or leverage the equity you have in your home.
- Higher utility bills: Having an additional living space means your gas, electric and water bills will be higher.
- You could have trouble selling your home: Not everyone wants to buy a house with a granny pod. It could also raise the property value so that some buyers may not be able to afford it.
Are Granny Pods actually Legal?
A Granny Pod may be legal in your area, but you may still need to get approval from your homeowners association, Waterman says. Not all municipalities allow homeowners to build granny pods in their backyards. In places where they are legal, homeowners still need to follow the rules regarding where these dwellings can be built, how they can be used and the maximum allowed square footage. These rules can be found in the local zoning code.
Granny pods will also need to be hooked up to the home’s existing sewer, water and power lines. You can contact your city’s planning office to ask about the process and the type of permits you will need.
How much does it Cost to put in a Granny Pod?
There are a number of companies that offer prefabricated granny pods with different floor plans and amenities at various price points. Another option is to convert an existing structure, like a shed, into a livable dwelling.
According to HomeAdvisor, a newly constructed granny pod can cost upward of $100,000 on average, but it can easily be more depending on size and materials used. A 400-square-foot ADU can range from $40,000 to $80,000 while a 750-square-foot addition can cost $75,000 to $150,000.
While the upfront cost is high, the Cost of Care Survey by Genworth found that a private room in a nursing home costs $297 per day or $9,034 per month. Semi-private rooms are more affordable, costing roughly $260 per day, or $7,908 per month. However, Medicaid may also help pay this bill.
Are Granny Pods Worth It?
Aside from the initial cost of building or converting one, you should think about whether you can provide all the basic necessities, like air conditioning and heating, and whether adding a granny pod will create too much of a financial burden for your household.
“If you add a granny pod on your property, does that increase your property taxes?” Waterman adds. “And then having the conversation about who’s going to cover that additional cost.” But it could also be beneficial. Moving an older relative into a granny pod could prevent the need for a formal caregiver, which costs about $4,224 per month on average, according to SeniorLiving.org.
“It really is about weighing the pros and cons for you financially when you’re thinking about this type of arrangement,” Waterman says.
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