Cut-Rate ADU Contractors Can End Up Costing Homeowners Twice as Much

Written by:

Rudi Davis

Date:

17 Sep 2025

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The head of a major ADU construction platform says homeowners are falling victim to a wave of unrealistic pricing promises in California’s accessory dwelling unit market.

Jon Grishpul, Co-CEO of Maxable, argues that deceptively low contractor bids are creating a “Gold Rush” mentality that ultimately costs homeowners far more than working with properly qualified builders from the start.

The True Cost Reality

“An ADU isn’t just like a little shed in your backyard. An ADU is a home,” Grishpul says. “It has an HVAC system, kitchen, bathroom, sewage, plumbing, electric, insulation, windows, door, foundation, footings – everything that goes into building a 4000 square foot home compressed into a 400-1200 square foot space.”

According to Grishpul, homeowners are being misled by headlines promising ADUs for as little as $10,000-15,000. He points to cases of people ordering “tiny homes” online only to receive what amounts to a postcard in the mail – clear evidence of outright scams targeting the growing ADU market.

The Underbidding Crisis

“I’m calling this the ADU Gold Rush,” Grishpul says, “because just like back then, everyone who thinks they know how to swing a hammer says ‘I could do that…I’ve been remodeling bathrooms for years, I could build an ADU.’ And they severely underbid the project.”

These inexperienced or unscrupulous contractors often run out of money partway through construction, Grishpul notes. “By the end of the project, you’ve already doubled, if not tripled, your initial budget.”

Finding Legitimate Contractors

Grishpul advises that dramatically lower bids should be a red flag: “If you hire the cheapest contractor, and it’s radically cheaper than the others, they’re either missing something, trying to take advantage of you, or they don’t know any better.”

He recommends thoroughly vetting contractors by:

• Checking for local ADU-specific experience
• Speaking with recent ADU clients
• Being wary of contractors with only kitchen/bath renovation reviews
• Ensuring they understand local building requirements

The Solution: Due Diligence

Through his company’s contractor matching service, Grishpul aims to help protect homeowners by pre-vetting qualified ADU builders. The platform reviews contractor experience, checks references, and helps homeowners compare bids to ensure they’re “comparing apples to apples.”

While acknowledging that proper ADU construction isn’t cheap, Grishpul argues that working with qualified contractors ultimately saves money by avoiding the pitfalls of underbidding and ensuring projects are completed correctly the first time.