Choosing to build a backyard cottage is an important long term decision. A good first question to ask when making that decision is how will I establish a budget for the cottage? While it may be hard to put a value on how a well designed home makes you feel or the value of having a family member living nearby, some qualities are easier to asses. If that family member is an aging parent who would otherwise be living in an assisted living facility, it is relatively easy to look at the costs of local facilities. For others building a new cottage may be less expensive than remodeling their existing house to more closely meet their needs. For example, new cottages can incorporate universal design components to assist those with mobility impairments.

Many people plan to use their cottages to generate rental income. In this case, a careful consideration of the rents in your area and anticipated costs can help you establish a budget range. And increasingly people are using condominium agreements to sell DADUs separately from the primary residence. These are five recent condominium sales of DADUs in Seattle.
https://www.redfin.com/WA/Seattle/11040-1st-Ave-NW-98177/unit-B/home/168914668
https://www.redfin.com/WA/Seattle/4536-Eastern-Ave-N-98103/unit-B/home/160472609
https://www.redfin.com/WA/Seattle/8511-2nd-Ave-NE-98115/unit-B/home/168660388
https://www.redfin.com/WA/Seattle/3202-NW-70th-St-98117/unit-2/home/168674693 (The primary residence sold as well)
https://www.redfin.com/WA/Seattle/538-B-NE-92nd-St-98115/home/169451063

In the past real estate appraisers have struggled with how to value backyard cottages and other ADU's primarily because there were simply not enough comparable sales to serve as a guide. With the sales of DADUs as condominiums and the sale of houses with houses becoming more common that task is getting easier.