Getting the money to build your dream home out of shipping containers can be a daunting tasks. Many lenders will not give loans for shipping container home construction. In the blog we will explore another way to get financing without having to spend your life’s savings.
Navigating the world of loans and zoning laws can be daunting, but understanding your options can turn these hurdles into stepping stones. This article delves into the intricacies of financing and zoning, and explores the multifaceted uses of ADUs that can transform your property into a versatile living space.
What are ADU’s?
ADU’s are Accessory Dwelling Units are small, self-contained residential structures located on the same property as a primary home. Commonly referred to as “granny flats” or “mother-in-law apartments,” ADUs can serve various purposes, from rental income to family accommodation. When built using shipping containers, these units not only offer a modern and sustainable alternative to traditional construction but also promise a robust, cost-effective solution.
In an era where space efficiency and sustainable living are increasingly prioritized, the concept of Accessory Dwelling Units (ADUs) is gaining traction. These small secondary residential structures provide an innovative solution for property owners looking to maximize their space. Unlike loans for constructing your primary home, acquiring a loan for an ADU can be a great opportunity to finance the construction of a shipping container home, office, gym, or any other use you might think of.
The Financial Challenge: Securing a Loan
Fannie Mae loans might be a path worth exploring. These loans could provide the necessary funds if you qualify and if your project meets certain criteria. It’s crucial to consult with a knowledgeable lending agent who can guide you through the specifics of obtaining such a loan for your ADU project.
Securing a loan to build a shipping container home can be a challenge. Most lending institutions are not familiar with the use of shipping containers as a building block of a single family home. They have years of experience loaning to home builders who are using more conventional building systems like wood framing with brick or siding veneers. Because of their lack of experience lending to shipping container building construction, they do not have the confidence of its successful completion.
Other lenders view shipping container homes as a temporary structure and not a permanent dwelling. This can put the shipping container home in a different type of category of home construction that the lending institution might not deal with.
But, the risk is limited to the lending institutions when there is already a primary home built on the property. This existing primary home can serve as collateral when the lending institution crafts a loan for an ADU on the same property.
The Legal Challenges: Zoning and Regulations
Before you dive into construction, it’s essential to understand the zoning laws in your local municipality. Some areas have restrictions on using shipping containers for ADUs or have limitations based on the Floor Area Ratio (FAR). This can affect how much additional square footage you can legally add to your property.
Key Considerations:
- Property Zoning: Ensure your property is zoned to allow for ADUs. Some residential areas may have restrictions that prohibit secondary dwellings.
- FAR Limitations: FAR stands for “Floor Area Ratio.” Check the local FAR regulations, which dictate the maximum allowable building area on your property.
- Building Permits and Codes: Your shipping container ADU must comply with local building codes, which might involve structural, safety, and aesthetic considerations.
- Historic Preservation Commissions: Landmark historical preservation commissions might exist in the are your want to build. They can have restrict the appearance of additional structures built on your property out of shipping containers.
- Neighbor’s Approvals: Some neighbors might not what their community cluttered with what they might perceive as unattractive steel boxes in your back yard and might complain to officials about their displeasure of your ADU.
The Versatile Uses of ADUs: Enhancing Life Quality
Building an ADU on your property is not just about financial gain; it’s about versatility and improving quality of life. Here are four potential uses for your shipping container ADU. They are listed in an order you might find that would reflect the stages in your life:
Stage 1: Rental Income for Young Families:
As the housing market becomes increasingly competitive, many young families are searching for affordable rental options. An ADU provides a perfect stepping stone for these families, allowing you to generate rental income while helping others start their new family’s journey
Stage 2: A Home for Aging Parents:
With more families embracing multigenerational living, an ADU can serve as a comfortable and independent living space for aging parents. This arrangement fosters family cohesion and ensures your loved ones are nearby, creating a supportive environment.
Stage 3: A Temporary Home for Older Children:
For older children saving to buy their own homes, an ADU offers an ideal solution. They can enjoy the independence of living on their own while remaining close to family, and you benefit from rental income that contributes to the ADU’s upkeep
Stage 4: A Retirement Haven:
As you approach retirement, downsizing might become appealing. Moving into the ADU allows you to rent out the primary home, generating additional income to support your retirement lifestyle. This arrangement can fund travel and leisure activities, enhancing your golden years.
Turning Challenges into Opportunities
Constructing a shipping container ADU requires careful planning and consideration. From securing financing to navigating zoning laws, each step presents unique challenges. Yet, with the right approach, these obstacles can become opportunities to create a valuable asset that enhances your property’s utility and financial potential.
For savvy property owners, particularly those looking toward retirement, a shipping container ADU offers a creative and pragmatic solution to modern living challenges. By understanding the financial, legal, and logistical aspects of building an ADU, you can transform your property into a multifaceted asset that supports your financial goals and family dynamics.
Remember, the first step is to consult with local municipalities and lending agents to explore your options and ensure compliance with all regulations. With the right preparation, your shipping container ADU can become a cornerstone of sustainable living and financial freedom.
Removing Uncertainties One Step at a Time
Financing the construction of your shipping container dream home is only one of many issues you will need to address when designing your shipping container home. It can be overwhelming when thinking of all the obstacles that are in front of you. It doesn’t have to be that way. Watch the free 90 minute seminar title, “6 Step Formula to Design and Build Your Own Shipping Container” and take the uncertainties away one step at a time.