The six places ADU budgets drift
| Where it leaks | Why | Your defense |
|---|---|---|
| The scope you didn't price | A low bid that excludes utility trenching, panel upgrades or fees isn't cheaper — those costs arrive later as "extras." | Compare exclusions, not totals. Run bids through our bid comparator and read the bid-comparison guide. |
| Soft costs no one bundled | Design, engineering, plan check, impact fees, surveys and Title 24 aren't in the construction number — and no single company bills them. | Budget by category up front with our soft-costs guide, then get each fee quoted by your city and utilities. |
| Site surprises | Slope, poor soil, buried utilities, an undersized panel, or an existing structure in worse shape than it looked. | A thorough contractor walkthrough surfaces most of these before the bid; a contingency covers the rest. |
| Change orders | Every mid-project change — chosen or forced — is priced without competitive pressure, because you're already committed. | Insist on a written change-order process, minimize choices left "TBD," and finalize finishes before construction starts. |
| Finish creep | Allowances set low in the bid ("flooring: TBD") get spent up fast once you're choosing real materials. | Demand real allowance numbers in the bid, and price your actual finish choices against them early. |
| Contract structure | A cost-plus contract with no cap, or a fixed-price contract with thin scope, both shift risk onto you. | Know which risk you're taking — see fixed-price vs. cost-plus — and negotiate a guaranteed maximum price where you can. |
Notice the pattern: none of these is bad luck. Each is a decision — made or deferred — before construction. The homeowners who stay on budget aren't lucky; they priced the whole project (not just the build), read the exclusions, and left fewer decisions for mid-project.
The one number that prevents most of it: contingency
A contingency is money set aside for the unknowns every project has. Budgeting to 100% of your available funds is a plan to run out the first time the ground surprises you. A buffer turns a "budget disaster" into a manageable line item. What percentage is right depends on your project's certainty — a pre-approved-plan detached unit on a flat lot carries less risk than an older-home conversion — which is exactly the kind of thing a property review helps you gauge before you commit.
Budget-protection checklist — do these before you sign
- Price the whole project, not the build. Construction bid + every soft-cost category + contingency.
- Compare exclusions across bids. The cheapest headline number often has the most gaps — the bid comparator makes them visible.
- Get real allowance numbers. No "TBD" line items; price your finishes against the allowances before work starts.
- Confirm the down-payment and payment schedule are legal. California caps the down payment; see the contract guide.
- Hold a contingency. Separate from the budget you plan to spend — sized to your project's uncertainty.
- Walk the site with each contractor. Surprises found now are cheaper than surprises found mid-build; use the walkthrough guide.
Frequently asked questions
There's no single right percentage — it scales with your project's uncertainty. A pre-approved-plan detached unit on a flat, hazard-free lot carries less risk than converting an older structure with unknown conditions. The point isn't a magic number; it's that a budget with zero buffer runs out the first time the site surprises you. Budget it separately from what you plan to spend.
In our experience the biggest single driver is scope that was never priced — utility trenching, panel upgrades, permit and impact fees, Title 24 and solar left out of the construction bid, then returning as 'extras.' That's why comparing what each bid excludes matters more than comparing totals; our bid comparator is built to surface exactly those gaps.
It caps the risk for the scope it actually covers — but a fixed price built on thin scope still returns as change orders once work exposes what was left out. Fixed-price protects you most when the scope is genuinely complete and detailed. Our contract guide covers how each structure allocates risk.