The national housing shortage, the benefits of increased population density, continued shifts in consumer preferences toward smaller homes closer to where urban activity occurs, and other factors have led state legislatures to: I am being forced to do something. please make it easy Build an accessory dwelling unit.
In 2024 alone, Colorado, Arizona, Massachusetts, and Hawaii passed major ADU bills, and California added several laws to open the door to ADUs. Ultimately, however, local governments remain the key gatekeepers when it comes to liberalizing ADUs. While state-level ADU policies are taking aim at local rules that impede ADU development, there is still work to be done.
But first, the good news. Colorado’s HB24-1152 and in arizona SB1415 We followed the main principles of a standard approach to promoting ADU development. They legalize ADUs as a matter of course (i.e., municipalities cannot simply ban them), eliminate or minimize requirements for additional parking requirements, and require municipalities to have stricter ADU design requirements than for primary residences. prohibited from enforcing, and relaxed or eliminated the owner. Occupancy requirements. hawaiian SB3202 It follows this, but does not address parking requirements.
Massachusetts Affordable Housing ActThe bill, passed in August, would allow ADUs of less than 900 square feet on single-family lots. State officials expect the law will result in 8,000 to 10,000 ADUs being built over the next five years. California, which passed its first ADU law in 1982, has passed five ADU-related laws:
- AB976 Permanently prohibits repeal of owner occupancy requirements.
- AB1033 An ADU can be sold separately from the main residence.
- AB1332 Requires all cities and local governments to develop a program for pre-approval of ADU plans that will be posted on the agency’s website to streamline the review process.
- SB1211 It makes it easier to build ADUs for multi-family housing.
- SB1210 Utilities must publish estimated costs and completion times for common service connections, including ADUs (so owners have advance knowledge of the cost and timing of utility connections).
State legislatures continue to pressure local governments to ease or eliminate ADU-related restrictions (13 and counting) I did that), utility and other fees (collectively known as impact fees) are moving toward the center of pro-ADU policy discussions. This is because impact fees can add up to enough amounts to prevent the development of an ADU.
Let’s look at some examples from Colorado. In Colorado, the state and many local governments are working diligently to change the regulatory environment in favor of large single-family homes. The town of Lyons, near Boulder, is looking to increase its population density. However, traditional regulations that favor large single-family homes impose impact fees on each door of high-density single-family developments, making them financially unsustainable. So, despite the close-knit community of ADUs that aligns with Lyon’s community goals, it appears the land will instead be given to developers of standard single-family homes.
In Nederland, another town near Boulder, the cost to build an ADU (or any other home) totals about $65,000. If you’re building a $2 million mansion, that’s probably a rounding error. But if you’re considering a $200,000 ADU, it’s a big hit.
To the Netherlands’ credit, they are working on water research and intend to reduce these charges. There is a clear trend in this town. Hardly a week goes by that some local government in the country doesn’t liberalize its ADU-related ordinances. Based on these and my own experience, there are several things municipalities can do to help foster ADUs beyond what is typically found in new state mandates.
- We prorate impact fees based on the size of the building, not just whether it is a residential unit. From a utility’s perspective, a 750 square foot ADU is not the same as a 5,000 square foot home.
- Consider the following programs Free system development costswhere the ADU is not intended for short-term rentals, such as in Portland, Oregon. These fees may include transportation (for potential site improvements), water, sewer, stormwater, parks, and recreation.
- Evaluate how zoning and permitting will work (or not work) for multi-unit or small-unit developments if single-family homes have historically dominated.
- Fast-track permits for ADU builders to build ADUs based on advance design plans submitted in advance, as California does with AB 1332.
Finally, a broader consideration. Consider the long-term benefits of densification. This includes increases in sales tax revenue and property tax revenue. Also, from the perspective of public safety, there are no headaches associated with apartment complexes.
State and local governments have come a long way to smooth the path forward for those looking to add significant infill housing through ADUs. But ultimately, local governments will hold the key to whether ADUs can open more doors to address America’s persistent housing shortage.
Mike Koenig is the president and founder of Studio Shed.
This column does not necessarily reflect the opinion of HousingWire Editorial Department or its owners.
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