The Skinny on Carriage Houses, or Accessory Dwelling Units in Denver CO

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An ADU, or accessory dwelling unit, is a small, habitable structure situated on a residential lot, usually behind the “primary” house. Utilities are tied in, making it easier and cheaper to build than a house. It’s a place where another person can live on the property with a little breathing space — they have their own bathroom and usually a small kitchen.

The setup can be ideal for multigenerational living, allowing an older parent or relative to live close. And an owner who wishes can rent out the place and take in income on the property.

ADUs are popular in many cities as a way to increase housing options and allow folks to “get more” out of their property, in a time when high real estate costs are a challenge for many.

ADUs are Great Because… Conservationists like ADUs because this type of infill building allows for increased density without really taxing the infrastructure. Community and housing organizations like them because it’s good for families and communities – making child care easier for younger families and allowing relatives to live together, share expenses, and hold onto their real estate. The use is flexible, so it can be great for a boomerang child for a few years and then might allow for rental income later on.

ADUs in Denver In 2010 the city of Denver revised its zoning code to allow for the construction of Accessory Dwellings (they had been banned since the 1950s). Interestingly, the trend hasn’t really take off yet, and fewer than 200 units have been built as of 2018. 

While ADUs won’t cure the housing shortage in Denver, it seems that more of them would help alleviate some of the demand. So while the city has “unbanned” ADU construction, the zoning code is cumbersome, as many lots are still only zoned for a single structure. It’s possible to file for rezoning if the lot size is large enough, but it may take a long time, cost money and be an arduous process to get through the neighborhood and city red tape. 

ADUs Can cost from $90-$150K or more. Most commonly, people will use a new construction loan or a home equity loan to pay for it. The plus side to taking a loan: if the accessory dwelling is going to earn income, it’s like an investment in your backyard.   

West Denver Renaissance Collaborative Neighborhoods in West Denver, like Athmar Park, Barnum, Sun Valley, West Colfax and others, have seen steep home price increases and, as a result, steep property tax increases. This has caused strain for some longtime residents in these traditionally Latino communitiesFortunately many of the properties in West Denver have smaller houses and larger lots, and are zoned for ADU or tandem house construction.

The organization was formed to promote ADUs and help residents build them, which in turn helps them live more affordably and stay in their properties. The program offers guidance throughout the process by helping with financing, providing ready-made designs to build, and connecting homeowners with contractors to do the work. 

Whether or not you live in West Denver, this handout offers some extremely helpful insight and information on the process of building an accessory dwelling in Denver. If only there were more such programs! 

Now You Want an ADU in Denver, right? With home prices in Denver at record highs and the rising popularity of “house hacking,” there’s new buzz about ADUs in Denver. To find out if you can build on a lot, enter the property address on the Zoning Map here to check your zoning code.  

If you need help, just call 720.514.9540 and we can help you through it. If your place is not compliant, it may be possible to rezone and we can connect you with experts who can do a feasibility study. 

If you are looking to buy Denver real estate zoned for an ADU, tandem or duplex, let us know here now and we’ll set you up with a customized search based on zoning codes. 

Build Your Wealth and Cash Flow with Smart Real Estate Investing! Agents at A Better Way Realty are trained to offer a comprehensive, wealth-building approach to real estate while helping clients. Please connect with us on your favorite social media platform, or email or call with any real estate questions. We look forward to staying in touch!