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Everything You Need to Know to Turn Your Backyard Unit Into Monthly Cash Flow.
Accessory Dwelling Units (ADUs) are becoming a popular investment for Sacramento homeowners. Whether you’re looking to generate passive income, build long-term equity, or simply make the most of your backyard space, renting out your ADU is a smart financial move.
Here’s a step-by-step guide to help you rent out your ADU in Sacramento, California.
Understand Local ADU Rental Laws in Sacramento
Before you list your unit, make sure your ADU complies with Sacramento zoning and rental regulations. Key points:
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ADUs can be rented out long-term (30 days or more).
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Short-term rentals (like Airbnb) are not allowed in most residential zones unless you have a special permit.
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The main home and the ADU can be rented separately.
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You do not need to live on the property to rent out your ADU (as of California’s recent updates).
Check with the City of Sacramento Planning Division for the latest updates.
Make Sure the ADU Is Rental-Ready
Even if your ADU is newly built, make sure it’s:
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Inspected and permitted
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Clean and move-in ready
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Equipped with basic appliances, heating/cooling, and internet
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Accessible via a private or semi-private entrance
Tip: Add thoughtful finishes like durable flooring and in-unit laundry to attract quality tenants.
Decide on Your Rental Strategy
Sacramento is a hot rental market, especially for:
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Traveling nurses
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College students (near Sac State)
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Tech and government workers
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Young families and retirees
Decide whether to rent furnished or unfurnished, and determine if you want to target long-term tenants or traveling professionals who sign 3–6 month leases.
Price It Right
Check local rental comps in your ZIP code (e.g. using Zillow, Apartments.com, or Craigslist). Factors that affect your ADU’s rent:
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Square footage
- Bedrooms & Bathrooms
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Location and proximity to public transportation
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Parking access
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Interior finishes and appliances
Most Sacramento ADUs rent between $1,800 and $2,500/month, depending on location and features.
| ADU Type | SQFT | Market Rent Range |
|---|---|---|
| Studio/ 1 Bed, 1 Bath | 400-600 | $1,400–$2,000 |
| 2 Bed, 1 Bath | 600-750 | $1,850–$2500 |
| 3 Bed, 2 Bath | 1000-1200 | $2,500-$3000 |
Take Quality Photos and List It
Professional photos can make a huge difference. Be sure to:
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Highlight natural light, clean lines, and open space
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Showcase amenities like in-unit laundry, kitchenette, or private patio
List your ADU on:
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Zillow Rental Manager
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Apartments.com
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Furnished Finder (for travel nurses)
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Facebook Marketplace
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Nextdoor
Screen Tenants Carefully
Use services like Zillow or Avail to:
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Run credit and background checks
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Verify employment and income
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Collect application fees and references
California law requires fair housing practices, so make sure your process is clear, consistent, and compliant.
Sign a Lease and Set Expectations
Use a California-compliant lease agreement, which includes:
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Rent amount and due date
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Lease length
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Rules on pets, guests, noise, etc.
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Maintenance responsibilities
You can find lease templates from CAR (California Association of Realtors) or use platforms like Avail or TurboTenant.
Maintain the Property and Communicate
Happy tenants stay longer! Be responsive with repairs, maintain landscaping, and check in periodically. If you live on-site, set boundaries for privacy but stay approachable.
Final Thoughts
Renting out an ADU in Sacramento is one of the most effective ways to generate consistent, long-term income. With a clear plan and the right setup, your backyard can turn into a reliable cash-flowing asset.
Want to learn more about building and renting out your own ADU?
👉 Schedule a free consultation with the IMKAT Homes team today.
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