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ADU'S IN LA - As Los Angeles continues to streamline its ADU permitting process, accessory dwelling unit construction is accelerating across the city. Homeowners are increasingly viewing ADUs as flexible solutions for multigenerational living, rental income, and long-term property value. But while approvals may move faster, the realities of building an ADU remain complex and often misunderstood.
To better understand what happens beyond the permit counter, we spoke with Neev Kugel, owner of Oasis Builders Inc, a Los Angeles–based construction company with extensive experience delivering ADU projects across a wide range of sites and conditions. In this conversation, Neev offers a candid look at the cost drivers, site challenges, and planning decisions that shape successful ADU construction in Los Angeles once building begins.
Many homeowners assume building an ADU is a small, inexpensive project. From a builder’s perspective, what are the biggest misconceptions about cost?
One of the biggest misconceptions is the idea that an ADU is somehow a “lite” project. It isn’t. You’re not adding a shed. You’re building a small house, with the same structural systems, utilities, and regulatory requirements as a primary residence.
In Los Angeles, real construction costs typically range from about $300 to $400 per square foot, which places total project budgets between $150,000 and $350,000 or more, even before upgrades and custom finishes are introduced. So when someone hears a quote under $100,000 for a new or detached ADU, that number should raise questions. In this market, it’s usually incomplete or unrealistic.
Permits are another major blind spot. City fees, plan checks, and approvals can quietly add several thousand to well over $20,000, depending on the size and scope of the project. Then there’s site work, which many homeowners underestimate entirely. Grading, foundations, sewer and water connections, utility upgrades, and electrical panel work can significantly impact the budget before the structure even starts to rise.
Even garage conversions, often assumed to be inexpensive, require meaningful investment. Structural reinforcements, insulation, plumbing, electrical, and mechanical systems must all meet current code, and Los Angeles does not make that process casual or inexpensive.
And finally, finishes matter. Cabinetry, flooring, backsplash, and lighting choices can shift costs dramatically. Add architectural and engineering fees, energy compliance documentation, surveys, and project management, and soft costs alone can reach 10 to 20 percent or more of the total budget.
The reality is simple: an ADU is a serious building project. When homeowners understand that from the beginning, expectations align, decisions improve, and the process becomes far more successful.
Even with careful planning, ADU projects often exceed initial budgets. What most commonly drives cost overruns?
Most budget overruns don’t come from extravagance. They come from reality revealing itself once construction begins. Building has a way of pulling back the curtain.
Existing conditions are the most common trigger. Soil quality, hidden foundation issues, undocumented utilities, or slabs that don’t meet current seismic or structural code are often discovered only after demolition. Once uncovered, these issues must be addressed. They’re mandatory fixes, required for safety and compliance, and they immediately reshape the budget.
Design changes also play a role. After permits are approved, even small adjustments such as moving a window, upgrading finishes, or refining layouts can trigger revisions, re-submittals, and added labor. There’s also what we call “Pinterest creep,” when inspiration evolves mid-build. It’s natural, but once construction is underway, those changes carry real cost.
Utilities are another frequent surprise. Electrical panels often need upgrading to modern capacity. Sewer laterals may require replacement or upsizing. Gas lines, water meters, and backflow devices all need to meet current standards, not the home’s original era. That gap between past and present adds up quickly.
Local jurisdictions and utility providers add another layer. Plan check corrections, additional inspections, and shifting interpretations of ADU regulations can slow progress. Delays extend schedules, and time in construction is money. Extended labor, remobilization, and general conditions quietly compound.
Structural and seismic upgrades also surprise homeowners. Shear walls, hold-downs, moment frames, and roof reinforcements often emerge once engineering is finalized. These changes ripple through framing, concrete, inspections, and timelines.
The common thread is clarity. When plans are incomplete or still conceptual at contract time, assumptions are made. And what isn’t clearly defined early almost always becomes a paid change later.
How do site conditions shape feasibility, timeline, and cost?
Site conditions influence cost, timeline, and feasibility from day one. Long before finishes or layouts are discussed, the land itself is already influencing cost, schedule, and what’s realistically possible.
Lot slope and soil conditions are foundational. A flat, stable site allows construction to move efficiently. A steep or uneven lot introduces additional excavation, grading, retaining walls, or specialized foundation systems. Poor or expansive soils often require engineered solutions, which extend timelines and increase foundation costs. In some cases, designs must be adjusted to meet structural or code requirements.
Utilities are equally influential. Water, sewer, gas, and electrical lines may be far from the structure, undersized, or undocumented. Sewer tie-ins, electrical upgrades, or gas line resizing often require coordination with city departments and utility providers. Those schedules don’t always align neatly with construction timelines, and trenching or service upgrades can add both time and cost.
Access and logistics also matter more than people expect. Narrow driveways, hillside sites, shared access, or tight urban lots limit equipment use and material staging. When space is constrained, construction slows. Smaller equipment, controlled delivery windows, off-site storage, and increased coordination extend build durations and elevate costs.
Then there are existing structures and hidden constraints. Working around an occupied home or neighboring properties increases complexity. Once demolition begins, undocumented utilities, old footings, or prior unpermitted work can surface. These discoveries often require engineering reassessment or design revisions.
The takeaway is this: site conditions are not a footnote. They are foundational. Challenging slopes, limited access, or utility constraints can reshape a project in very real ways. Early, thorough site evaluation doesn’t eliminate complexity, but it allows for accurate budgeting, realistic timelines, and thoughtful design decisions before construction ever begins.
(Ana Peregrine writes about the spaces we live in and how intentional design can make them more functional, beautiful, and humane. A journalist and lifelong design nerd, she focuses on interiors, remodels, and why good design truly matters.)
