A garage isn’t just a place to park your car anymore. If you’re like many homeowners across the U.S., you might be looking at that space and wondering: Can I turn this into something more useful? Maybe you want a place for your parents to stay, a home office with privacy, or even a small rental unit to earn extra income. The answer is yes—it’s possible, and if done right, it doesn’t have to cost a fortune.

In this guide, we’ll break down the cheapest way to convert a garage to an ADU, including what you actually need (and what you don’t), how to stay within budget, and how to avoid the common mistakes that lead to unexpected costs.

Why People Convert Garages to ADUs

The housing market has shifted. Home prices are higher, rentals are harder to find, and multigenerational living is more common than ever. That’s led many homeowners to rethink how they use the space they already have.

A garage conversion can work for:

  • A guest suite or in-law unit
  • A private workspace or studio
  • A long-term rental for income
  • A housing option for adult children
  • A full-time downsized living space

The best part is that you already have the bones of the structure. You’re not starting from nothing—which means less construction, lower costs, and a much faster turnaround compared to building an ADU from the ground up.

How Much Does It Cost to Convert a Garage to an ADU?

Full garage conversions typically range anywhere from $60,000 to $120,000 or more, depending on location and finish level. But if you’re willing to prioritize the basics and make smart choices, you can often convert your garage to an ADU for closer to $25,000 to $50,000.

Where the price lands depends on:

  • The size and condition of your existing garage
  • Local building code requirements
  • How much of the work you do yourself
  • Whether you need a bathroom or kitchen
  • What type of finishes you choose
build home in garage and consider space

Step-by-Step: Cheapest Way to Convert Garage to ADU

This isn’t a luxury build. This is the most affordable way to convert garage to ADU without cutting corners where it matters.

Step 1: Make a Plan

It’s easy to rush into a project when you’re excited, but the cheapest builds always start with a solid plan. Ask yourself:

  • What’s the end use for this ADU?
  • Will someone live here full-time?
  • Do I need a kitchen and bathroom, or just sleeping space?
  • What’s my realistic budget ceiling?

Sketch a simple floor plan. Walk through the space and think about layout, lighting, and how to make it feel livable without overbuilding.

Step 2: Check Local Regulations

Before doing anything, talk to your city’s planning or building department. Rules for ADUs vary across the country, and even neighboring counties can have different requirements.

They’ll tell you:

  • Whether your property qualifies for an ADU
  • What the minimum square footage or setbacks are
  • Whether you’ll need permits and inspections
  • What’s required for legal occupancy (ceiling height, egress windows, etc.)

Getting clear answers early will save you time and money later.

Step 3: Keep the Existing Structure

This is where most of your savings will come from. The more of your garage you leave intact, the more you’ll keep in your pocket.

To save:

  • Keep the exterior walls, slab, and roof as-is
  • Don’t move or remove the garage door—just insulate it and build a wall inside
  • Avoid changing the footprint or layout of the building

If your garage is structurally sound, this alone can cut your costs in half compared to a full build.

Step 4: Insulate and Finish the Interior

You’ll need to insulate your ADU to make it comfortable year-round and to meet energy codes. If you’re handy, this part is very DIY-friendly.

Budget insulation and finishing tips:

  • Use foam board or batt insulation in walls and ceiling
  • Install basic drywall and tape it cleanly
  • Paint with light, neutral colors to brighten the space

You don’t need high-end finishes here. Focus on clean, functional, and code-compliant.

Step 5: Flooring That Works for Less

You don’t need hardwood or tile to make the space livable. In fact, you can leave the concrete slab and work from there.

Some of the most affordable options:

  • Clean and paint the slab with epoxy
  • Lay floating vinyl plank flooring (waterproof and looks good)
  • Use large rugs to soften the space without adding labor

Stick to durable, moisture-resistant materials, especially if your garage is at ground level.

Step 6: Heating and Cooling on a Budget

You don’t need to run expensive ductwork or install a full HVAC system. There are cheaper options that still get the job done.

Low-cost heating and cooling options:

  • Portable space heaters and window AC units (good for part-time use)
  • Mini-split system (slightly more expensive but energy-efficient and clean)
  • Electric baseboard heaters or wall-mounted fans

What you choose depends on your climate and how often the space will be used.

Step 7: Add a Kitchenette if Needed

If you’re converting the garage into a true ADU—one that’s meant to be rented or used full-time—you may need some kind of kitchen.

Instead of building a full kitchen:

  • Use a small cabinet and sink kit from a hardware store
  • Add a mini fridge and plug-in cooktop
  • Skip the gas line—go electric

Keeping plumbing close to the existing water line or main house helps control costs.

Step 8: Keep the Bathroom Simple

Adding a bathroom is usually the biggest line item in a garage conversion. If you can get away without one (for example, if the space will be used by family), that can save you thousands.

If you do need one:

  • Use a basic 3-piece setup: toilet, shower stall, small sink
  • Use pre-fabricated shower inserts instead of tiled builds
  • Keep plumbing short and simple

If your garage backs onto your main home, that may make plumbing connections easier and more affordable.

Step 9: Use Natural Light and Smart Lighting

Garages can feel dark, especially if the doors are closed off. Use whatever natural light you have—windows, skylights, or glass panels—and then supplement with budget lighting.

Options:

  • Floor lamps and plug-in sconces
  • LED ceiling lights or strip lighting
  • Reflective paint colors and mirrors to bounce light around

You don’t have to hardwire everything. Plug-in lighting works just fine if the space isn’t a primary dwelling.

What to Avoid If You’re on a Tight Budget

  • Don’t move plumbing if you don’t have to
  • Don’t install a high-end kitchen or finishes
  • Don’t remove the garage door unless absolutely necessary
  • Don’t hire a general contractor if you’re managing the project yourself
  • Don’t ignore insulation—it’s cheap and critical

Conclusion

Converting your garage to an ADU doesn’t have to be expensive—but it does have to be thoughtful. Focus on what makes the space safe, functional, and comfortable. Don’t get caught up in fancy upgrades that won’t give you a return.

Keep the structure intact. Use budget-friendly materials. Prioritize the essentials. If you do those three things, you’ll end up with a livable space that adds real value to your property.

And if you’re planning to rent it out, always check your local ADU laws and permitting rules so you’re not hit with surprise violations later.

Looking for guidance or professional support?

If you’re considering a garage-to-ADU conversion and want to make sure it’s done right from the start, get in touch with our team at Top Home Builders. We work with homeowners across the U.S. to design and build ADUs that meet budget, lifestyle, and code—all without unnecessary upsells.

Contact us to get started. Let’s turn your garage into something that works for you.