City of San Diego limits companion units to 700sf. And there are limits based on lot size, parking, where on the lot it would be placed, etc.

You are right – it doesn’t pencil out from a strictly financial point of view – higher equity. But from a FAMILY point of view it can be a great solution. We were able to offer my inlaws over 5 years of independent living they would NOT have had if we didn’t build it. The nursing home costs would have been higher. And they had a better quality of life.

And – don’t discount the income it can generate when it’s no longer used by family. We’re getting a very nice rental income now. It was a factor that played into my ability to retire early.

If you look at it from strictly real estate financial perspectives – we have a long payback. But if you factor in nursing home costs for family members…. maybe not so much. And if you factor in the fact that we were able to do the right thing by my in-laws – that is worth a HUGE amount to me. For others, it might not have value.