Sheds: Housing Works

Backyard sheds traditionally house lawn mowers and garbage cans. But in the insane California real-estate market, where many families can't afford to buy bigger homes, gussied-up sheds are housing something else: people. At The Shed Shop, in Fremont, sales of "room-addition alternatives" have tripled in the last five years. Instead of spending big bucks and living with months of sawdust for a traditional addition, homeowners hire the firm, or rivals like Tuff Shed, to build customized wooden, shingled backyard structures. Sizes range from 4 feet by 8 feet to 12 feet by 16 feet for an average price of $3,100; construction takes just a day or two. Customers then hire contractors (or do it themselves) to add insulation, drywall, carpeting and electricity. Some buyers opt for air conditioning, vaulted ceilings and skylights--but most building codes restrict plumbing. Linda Rugg, of Albany, spent $13,000 on her husband's shed-office. "It feels very much like a little cottage," she says.

Like Rugg, most customers use the sheds for home offices, art studios or hobby areas, but some space-starved families are using them as spare bedrooms or guest rooms. Even though building codes often prohibit spending the night out there, lots of people do it anyway, says Albany planning manager David Dowswell. Who'd have thought sheds could be so chic?