In today’s market, buying a home with an Accessory Dwelling Unit (ADU), or adding one to your current house, could be an attractive option.
In fact, a recent survey shows that 24 percent of agents polled said an ADU, such as a mother-in-law apartment, is one of the most desired features buyers are looking for right now.
What is an ADU?
A detached accessory dwelling unit is a separate home from the main home built on a single-family lot. Originally intended for relatives, such as grown children or an aging grandmother, ADUs are becoming increasingly desirable as a stream of revenue via a short- or long-term rental.
According to Fannie Mae, it must include its own areas for living, sleeping, cooking, and bathrooms independent of the main house.
And they can take shape in a few different ways. An ADU can be:
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Within a main home, such as a basement apartment
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Attached to a main home, such as a living area over a garage
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Detached from the home entirely; it could even be a manufactured home
The growing appeal makes sense. With rising costs all around you, an ADU can help supplement your income and ease some of the strain on your wallet.
Whether you buy a home that has one already or you add one on, it gives you the option to rent out that portion of your home to help pay your mortgage.
Here are some of the other top benefits of ADUs, according to Freddie Mac and the AARP:
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Living Close, But Still Separate: You get the best of both worlds — more quality time together, plus privacy when you want it. If that sounds like a win, it might be worth looking for a home with an ADU or adding one to your home.
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Aging in Place: Similarly, ADUs allow older people to be close to loved ones who can help them if they need it as they age. It’s a sweet spot that offers independence and support from loved ones. For example, if your parents are getting older and you want them nearby, this could be a great option for you.
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Built-In Childcare: If your family’s living in the ADU, you may be able to use them for childcare, which can also be a big cost savings. Plus, it gives your kids more time with their grandparents.
It’s worth noting that since an ADU exists on a single-family lot as a secondary dwelling, it typically can’t be sold separately from the primary residence.
Colorado House Bill 24-1152, which became law in May 2024 and takes effect on June 30, 2025, aims to facilitate the construction of Accessory Dwelling Units (ADUs) across the state, promoting affordable housing options and streamlining the permitting process. The new law is expected to lead to a surge in ADU development across Colorado, contributing to the state’s housing supply.
In response, local governments are updating their zoning ordinances and regulations to comply with the new law. Currently in Colorado Springs, a detached ADU is not permitted within single-family zone districts but the city planning department is working on drafting a law that addresses the specific needs of the city.
