How Public and Private Incentives Can Strengthen the ADU Market

U.S. cities are in the midst of a housing crisis. Demand is high, supply is limited, and the supply being built disproportionately leans towards the luxury end of the market. Some cities, like Washington, D.C., have millions of square feet available for the development of accessory dwelling units (ADUs). If utilized, this land could provide an affordable supply of housing to meet ballooning demand in a relatively short amount of time. Unfortunately, those same cities have antiquated zoning regulations in place that discourage ADU development and their planning departments should consider removing those zoning regulations – namely, the ones that restrict the type of property ADUs can be built on and the size of the ADU, as discussed in part 2 of the ADU series. But removing regulatory barriers is only half of the solution. Removing regulatory barriers brings us back to base level. The housing crisis, however, is not a problem that can be solved by amending a zoning code and then wiping your hands and saying “well I did my job.” This is a unique problem and unique problems require unique solutions. Cities and organizations along the West Coast are beginning to think creatively about how to incentivize private homeowners and developers to build ADUs. By employing new incentive strategies and creating productive partnerships, they’re helping grow the ADU housing stock.

I. Public Incentives

II. Private Incentives

III. Public-Private Partnerships

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