ADU vs Tiny House: Why Prefab ADU’s Should Be on Your Radar

When it comes to a minimalist style tiny living, you’ve got two main options: an ADU or a Tiny House.

But what are the differences between these two types of ADU homes? And is investing in a prefabricated ADU really worth your hard-earned money?

At first glance these micro-dwellings may sound similar but there are some key differences that you need to be aware of in real estate.

For example, an ADU that is setup in your backyard is simply amazing for remote work and creating a personal haven for working from home.

On the other hand a tiny home is fantastic if you’re more than likely to change locations and want the perfect living environment in a tiny package.

I’ll dive into ADU vs tiny house and uncover all the details about both so that you can make an informed decision on which alternative housing options that works best for you.

Get ready to explore everything from similarities and differences, to the cost benefits of having an ADU built in your backyard!

What is an ADU?

An ADU stands for Accessory Dwelling Unit, is a secondary living space that can be attached to an existing home or built as a separate structure to a single-family lot.

It can provide additional living space, serve as a potential rental unit for extra cash, or even act as an office or studio.

There are many types of ADUs available depending on the needs and budget of the homeowner.

Different types of ADUs

ADUs come in all shapes and sizes depending on what is allowed in your area.

Some popular types include:

  • Garage conversions (which are often used for rental units)
  • Basement apartments (often used for extended family members)
  • Backyard cottages (great for rentals or work from home offices)
  • Granny flats (used primarily by elderly relatives)
  • Container homes (a more affordable option)
  • Accessory buildings/structures like sheds turned to livable spaces


ADUs are an ideal solution for homeowners looking to add additional living or work space, generate rental income or increase property value.

Benefits include flexible uses, additional privacy and is a more affordable option than traditional guest houses.

What is a Tiny House?

A Tiny House is a small dwelling, typically ranging from 100 to 400 square feet in size and typically sits on a rack of wheels (THOW), but they can be built on foundations as well (THOF).

A tiny house can include the main living area, bathroom, kitchen and sleeping areas all in one. Some tiny houses may also include outdoor decks or patios as part of the overall design.

It’s designed to be both affordable and mobile, making it an attractive option for those looking for an alternative lifestyle or simply wanting to downsize their living space.

Types of Tiny Homes

There are several types of tiny houses available today including:

  • Traditional stick-built homes
  • Prefabricated models
  • RV’s (recreational vehicles)
  • Park model trailers
  • Converted shipping containers.

Each type offers its own unique advantages depending on your needs and budget.

One major benefit of owning a tiny house is that it can provide you with more financial freedom since they tend to cost much less than traditional homes.

Additionally, many people find that downsizing their living space allows them to live more simply and focus on what matters most in life such as relationships or pursuing hobbies they enjoy.

Because they are so small they can often be moved easily which makes them perfect for those who like to switch up their environment and the possibility to move if needed.

Comparing ADUs and Tiny Houses: Similarities and Differences

ADUs and tiny houses have been gaining popularity in recent years as an alternative to traditional housing.

While they may look similar, there are a few key differences between the two that potential homeowners should consider before making a decision.

The cost between ADUs and Tiny Houses

When it comes to cost, both ADUs and tiny houses can be relatively affordable options depending on the size of the unit you choose.

However, ADUs tend to be more expensive than tiny houses due to their larger size and additional amenities such as plumbing, electricity, etc.

Additionally, since most ADUs are built on existing foundations or structures, there is often an additional cost associated with building permits or other legal fees.

The Size of ADUs and Tiny Houses

The main difference between these two types of dwellings is size; while both can range from small studio-style units up to multi-bedroom homes (depending on your budget), typically speaking an ADU will be larger than a typical tiny house due to its permanent foundation requirements.

This means that if you’re looking for extra space for guests or family members then an ADU might be the better option for you compared to a tiny house which usually has limited living space due to its smaller dimensions.

Is a Prefabricated ADU Worth the Investment?

Prefabricated ADUs are becoming increasingly viable as a way to add additional living space without having to go through the lengthy and expensive process of building from scratch.

Overall I’d say yes, an ADU is worth the investment if you’re looking for a potential source of income through rental opportunities and increased value add to your own property.

Prefab ADUs offer many advantages over traditional construction, such as shorter build times, lower costs, and greater flexibility in design.

However, there are also some drawbacks that should be considered before investing in a prefabricated ADU.

Advantages of Prefab ADUs over Traditional Ones

One of the main benefits of prefabricated ADUs is their shorter build and delivery time.

As they are built off-site in a factory setting, most prefab units can be completed within weeks or even days depending on the size and complexity of the unit and if they have them in stock.

This makes prefab ADUs an ideal solution for those who need extra space quickly but don’t have the budget or timeline for full-scale construction projects.

Additionally, since all components are pre-made in factories with advanced machinery and quality control processes, these units tend to be more reliable as well!

You get to skip usual issues with traditionally constructed ones that may suffer from poor craftsmanship or shoddy materials due to lack of oversight during construction on site.

Despite their many advantages over traditional builds, there are still some drawbacks to discuss.

For example, while they tend to cost less upfront than full scale builds due to quicker completion times and fewer labor costs involved; they often require specialized installation services which can drive up overall expenses.

Furthermore; while customization options exist for these units; they will never match the level available with custom builds meaning buyers may have difficulty finding exactly what they want.

So if you’re someone who’s looking for something unique or specific features then you might have a hard time choosing among existing models offered by manufacturers/sellers.


Prefabricated ADUs offer many advantages over traditional construction, such as shorter build times, lower costs, and greater flexibility in design. Just make sure to consider limited customization options.

Are tiny homes considered ADU in California?

If the tiny home is larger than 150 square feet, then yes a tiny home is considered as an Accessory Dwelling Units in California.

ADUs are defined as a self-contained living space that is either attached to or located on the same lot as an existing single-family home.

This includes detached ADUs such as backyard cottages and converted garages, as well as accessory structures within the main house such as basement apartments.

Tiny homes must meet all applicable building codes and zoning requirements for their location in order to be considered an ADU in California.

Wrap Up

Overall, ADUs and tiny houses are both great options for those looking to downsize their living space or create a unique living experience.

While there are similarities between the two, such as the small size and mobility, they also have distinct differences that should be considered when making your decision.

Ultimately, if you’re considering an ADU vs tiny house investment, it’s important to weigh all of your options carefully before making a final decision.

An ADU can be a worthwhile investment that provides comfortable housing with plenty of room for growth, especially if you are or plan to work from home extensively.

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