Quick Answer: A 1-bedroom ADU in San Jose rents for $2,000-$2,800 per month in 2025; a 2-bedroom ADU rents for $2,600-$3,600 per month. With a typical detached ADU construction cost of $250,000-$380,000, the gross rental income ROI is 6-15% annually — meaning a $300,000 ADU generating $2,500/month in rent returns $30,000/year gross before expenses (about 10% gross return). Net return after estimated expenses (property tax allocation, insurance, vacancy ~5%, maintenance ~1% of value/year) is typically 5-8% annually. At a $2,500/month net rent with a $300,000 construction cost, the ADU pays back its construction cost in approximately 10 years, after which it is 100% positive cash flow. ADU rental income can also be used to qualify for a refinance or HELOC to fund the construction — lenders may count 75% of projected ADU rent as income.
ADU Rental Income and ROI — San Jose 2025
Helpful Resources:
| ADU Type | Monthly Rent Range | Annual Gross Income | Gross ROI on $300K Build |
|---|---|---|---|
| Studio ADU (300-400 sq ft) | $1,600 – $2,200 | $19,200 – $26,400 | 6.4% – 8.8% |
| 1-Bedroom ADU (500-650 sq ft) | $2,000 – $2,800 | $24,000 – $33,600 | 8.0% – 11.2% |
| 2-Bedroom ADU (700-1,000 sq ft) | $2,600 – $3,600 | $31,200 – $43,200 | 10.4% – 14.4% |
| Garage conversion JADU (400-500 sq ft) | $1,400 – $2,000 | $16,800 – $24,000 | Varies by build cost |
Quartz Construction provides ADU rental income projections and financing guidance for San Jose homeowners. We build ADUs to maximize rental value — separate entrance, full kitchen, in-unit washer/dryer hookups. ADU construction services. CSLB #1003436 | Call (650) 749-7436.
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"Quartz Construction did an amazing job on our kitchen remodel. The team was professional, on time, and the results exceeded our expectations. Highly recommend to any Bay Area homeowner!"
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"We hired them for a bathroom remodel in our San Jose home. From permitting to final walkthrough, everything was handled perfectly. The tile work is stunning. 5 stars without hesitation."
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"Just finished our ADU garage conversion. The project came in on budget and on schedule — rare in the Bay Area! The rental income already started. Could not be happier with Quartz Construction."
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Quartz Construction & Remodeling | CSLB #1003436 | Licensed, Bonded & Insured
Phone: (650) 749-7436
Address: 1777 Hamilton Ave #1080, San Jose, CA 95125
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