Denver’s housing landscape is on the brink of a significant transformation thanks to House Bill 24-1152, Colorado’s new Accessory Dwelling Unit (ADU) law. Set to take effect on June 30, 2025, this legislation promises to bring a wealth of opportunities for property owners while addressing crucial housing needs in our community.
Key Provisions of HB24-1152
HB24-1152 introduces several important changes that will make it substantially easier for homeowners to add an ADU to their property. The law allows for ADUs in single-family residential areas across the state, removing previously restrictive owner-occupancy requirements. It also simplifies parking regulations and streamlines the permitting process, reducing bureaucratic hurdles that have historically deterred many homeowners from pursuing ADU projects.
New Colorado ADU Law Benefits for Homeowners
The benefits of this new law for Denver-area property owners are numerous and compelling.
Increased Property Value
Perhaps most notably, adding an ADU has the potential to significantly increase a home’s value, with estimates suggesting an increase of up to 35%. This boost in property value alone makes the prospect of building an ADU an attractive option for many homeowners.
Income Opportunities
Beyond the immediate financial gain, ADUs open up new possibilities for generating additional income. Whether through long-term rentals or short-term stays, an ADU can provide a steady stream of revenue for homeowners. This extra income can help offset mortgage payments, fund home improvements, or simply provide additional financial security.
Flexible Living for Multigenerational Households
The flexibility offered by ADUs extends beyond financial considerations. These units provide excellent solutions for intergenerational living, allowing families to stay close while maintaining privacy. For instance, adult children returning home or aging parents needing care can live independently yet nearby. This arrangement can strengthen family bonds while respecting individual autonomy.
Aging in Place
Looking to the future, an ADU can be a strategic investment in aging in place. As homeowners grow older, they may find that their current living situation no longer meets their needs. An ADU provides the option to downsize without leaving a beloved home and neighborhood. It can also accommodate caregivers or family members who may need to be close by to provide assistance.
Positive Community Impact
On a broader scale, the proliferation of ADUs has the potential to make a significant impact on Denver’s housing market. By creating more affordable housing options, homeowners who build ADUs contribute to addressing the city’s ongoing housing shortage. This not only benefits individual renters but also helps to create more diverse, inclusive neighborhoods.
ADU Options and Considerations
The new law allows for various types of ADUs, giving homeowners flexibility in how they approach their projects. Basement conversions can transform underutilized space into cozy apartments. Garage apartments can turn parking areas into functional living quarters. For those with available yard space, backyard cottages offer the opportunity to create charming, standalone dwellings.
Most ADUs range from 500 to 800 square feet, providing ample living space without overwhelming the primary property. This size range allows for comfortable, functional living areas while maintaining the character of existing neighborhoods.
To support this initiative and encourage homeowners to take advantage of the new law, the Colorado Housing and Finance Authority has established an $8 million program to assist in ADU development. This financial support can help offset construction costs and make the prospect of building an ADU more attainable for a wider range of homeowners.
While the opportunities presented by HB24-1152 are exciting, it’s important for homeowners to approach ADU projects with careful consideration. Construction costs and financing options should be thoroughly researched and planned for. Local building codes and regulations must be adhered to, even with the streamlined processes introduced by the new law. Additionally, homeowners should consider the potential impact on their neighborhood’s character and engage with neighbors to ensure harmonious development.
Implementation Steps for Your ADU
For those ready to embark on an ADU project, the process typically involves the following steps:
- Review local zoning and building requirements. This step is crucial to ensure compliance with all applicable regulations.
- Obtain the necessary permits is essential before any construction can begin.
- Decide whether to hire contractors for the entire project or manage some aspects independently.
As we approach the June 30, 2025 effective date of HB24-1152, now is an opportune time for Denver homeowners to begin planning. Underutilized spaces in homes or yards that may have seemed like liabilities could soon become valuable assets, opening new chapters in the homeownership journey.
The implementation of this new ADU law represents more than just a change in regulations – it’s an invitation for homeowners to reimagine their property’s potential. Whether the goal is to generate additional income, provide housing for family members, increase property value, or contribute to community housing solutions, this legislation expands possibilities previously unavailable to many homeowners.
The Takeaway
As Denver continues to grow and evolve, ADUs have the potential to play a crucial role in shaping the city’s housing future. By providing more diverse housing options, they can help create more inclusive neighborhoods and address pressing housing needs. For homeowners, ADUs offer a unique opportunity to invest in their properties, potentially increase their income, and contribute to the vitality of their communities.
At Truth Design Build, we are excited about the opportunities this new law brings to Denver homeowners. We are prepared to assist in navigating the process of ADU development, from initial planning stages through to completion. Our team of experts can help homeowners maximize the benefits of this new legislation while ensuring compliance with all relevant regulations.
Reach out today to start planning your ADU build or renovation.
