ADUs… making more sense than ever?

ADUs (Additional Dwelling Units) have informally been around for a long time. ADUs are known by many other names, including accessory apartment, backyard cottage, coach house, granny flat, guest house, in-law suite and secondary dwelling unit, among others. They are legally part of the same property as the main home and cannot be sold separately. They can be located within, attached to or detached from the main residence.

ADUs started as a way to meet the family needs, including options for young adults, multigenerational living, aging in place, and caring for someone in a semi-independent living situation, such as an elderly parent or a person with special needs.

ADUs can make more sense than ever now for families… both as our population ages and as it becomes more difficult financially for young adults starting out.

Not all cities allow ADUs and each city has its own ordinances which are not consistent from city to city. They have been approved by many cities in the Twin Cities area including Apple Valley, Blaine, Bloomington, Burnsville, Crystal, Eagan, Golden Valley, Hopkins, Inver Grove Heights, Lakeville, Long Lake, Minneapolis, Minnetonka, Mounds View, Orono, Plymouth, Richfield, Roseville, Shoreview, Stillwater, St. Louis Park, St. Paul, Wayzata and White Bear Lake.

Edina is in the process of considering approving them and has some good information about ADUs on their site.

Each city also has its own rules about renting them… one use is as an Air BnB for additional income, but not all cities allow short term rentals. Be sure to do your homework about requirements in your city if you plan to pursue an ADU on your property.

FHA just came out with a new policy that will allow lenders to use rental income from accessory dwelling units (ADUs).

If you are thinking about pursuing ADUs, the Family Housing Fund created a very helpful handbook, the Twin Cities ADU Guidebook for Homeowners to help you get started, including how to build an ADU. It was created in 2019, but much of the information it contains is timeless.

ADU guidebook

Sharlene Hensrud, RE/MAX Results – shensrud@homesmsp.com

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I love what I do! Highly insightful, analytical and creative, there is nothing I love more than helping you find the right solution for your real estate transition. My mission is to serve my clients with honesty and integrity, exceeding their expectations in service and support… and to help others by donating a portion of every transaction to Habitat for Humanity.

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