Denver's Readiness for ADUs by radiandenver

Denver’s Readiness for ADUs Expanding ADUs to Work Citywide

3 TABLE OF CONTENTS INTRODUCTION 5 Executive NeighborhoodShortHousingPopulationSummary......................................................4Growth........................................................6Market.............................................................7TermRentalMarket...........................................8Change...............................................10 POLICY + DESIGN 13 Supportive Policy.........................................................14 Zoning Recommendations......................................................18RezoningLegislativePolicy................................................................14Rezoning....................................................16Priorities.......................................................17 CONSTRUCT + FINANCE 21 OBY Cooperative - Bay Area, California...................22 Affordable Small Homes - Portland, Oregon..........24 WDRC ADU+ Pilot - Denver, Colorado......................26

Accessory Dwelling Units, also called ADUs, are smaller, self-contained, residential units located on the same lot as an existing residence, usually a single-family home. ADUs, as defined by the American Planning Association, can be internal - conver ted portions of existing homes, attached - additions to homes, or detached - stand alone structures. The impact of this housing type and their associated policies are commonly misunderstood but provide an opportunity to create more housing inventory while mitigating displacement. ADUs double density, promote mixed income housing, preserve primary homes, and tap into the existing network of streets and utilities.

EXECUTIVE SUMMARY

This comes at a time when neighborhood leaders of often high-income areas are pursuing zoning changes to allow for ADUs which in turn helps the construction and use of ADUs to be more affordable. This report evaluates how these preconditions, along with community understanding and political will, could drive a transformative systems change in Denver’s land use and housing policy. This report examines the preconditions of an ADU movement such as the affordable housing crisis, high land values, role of zoning regulations, design standards, and access to capital. It also includes qualitative and quantitative data from research and stakeholder conversations. Stakeholder engagement focused on understanding the value of ADUs as a tool to address the housing crisis while stabilizing homeowners to varying degrees. Dozens of community interviews support recommendations in this report. Community interviews were conducted with construction and finance partners (First Bank, Simple Homes, Habitat for Humanity of Metro Denver); registered neighborhood organization leaders from Athmar Park, Baker, Barnum, Chaffee Park, Capitol Hill, East Colfax, La Alma Lincoln Park, Northeast Denver, Villa Park, West Colfax, West Washington Park; policy impact organizations (Denver Regional Council of Governments, Neighborhood Development Collaborative, All in Denver, Mile High Connects, West Denver Renaissance Collaborative, YIMBY Denver, SPARCC), and the peer cities mentioned in this report.

5 INTRODUCTION

Population (thousands of people)

AGING IN PLACE

6 POPULATION GROWTH

The biggest challenge aging adults are facing in the Denver Metro Area is access to affordable housing. Housing burdens vary based on whether older adults rent or own their homes, but generally older adults are more likely to be housing burdened than the total population. Older adults who rent are more likely to spend 30 percent or more of their income on housing compared to older adults who own and compared to the total population. In order to age successfully, these individuals need access to quality housing. Aging in place combines housing choice, flexibility, entrepreneurship, mixed generations, and smart growth.

ADUs are a solution that allow aging adults to age in place and provide a myriad of solutions to the issues mentioned here

DENVER’S GROWING POPULATION 1,000,000800,000600,000400,000 2040203520302020201035%30%2000 4 or more beds 3 beds denver 2019 -None 110.6

The City and County of Denver is facing rapid growth and with that an increased demand for housing. Coupled with ever increasing land prices, many individuals are being priced out of their existing neighborhoods. Between 2010 and 2014, Denver’s population grew by nearly over 68,000 people. Of that, 62 percent was from in-migration, according to the state demographer’s office. Additionally, the size of the millennial population is increasing demand for entry-level market rate housing, and in turn, increasing rents and the need for affordable housing. Considering projections from the state demographer’s office that estimate Colorado’s population will exceed 7.9 million by 2040, the demand for housing will continue to grow.

The

2025202220212020201920182017201620152014 1 bed (13%) 2 beds (25%) 3 beds (30%) 4 or more beds (33%) None (0.9%) 47% 37% Denver Austin COMPARING SINGLE INCOME FAMILIES WITH NUMBER OF BEDROOMS AVAILABLE IN DENVER 41% Seattle 1 bed (13%) 2 beds (25%) Single Income, No Kids Others 3 beds (30%) 4 or more beds (33%) Even though nearly half of the population of Denver are single income, no kids households who would require less bedrooms, most of Denver’s housing stock has 3+ bedrooms. rateleveltheDenverMillennialsmovingtoareincreasingdemandforentry-markethousing.

7 HOUSING MARKET

At the same time the state’s population is increasing, Colorado, and the Denver Metro Area, are experiencing record increases in rental prices and property values. Denver’s median home price is rising quickly, up nearly 14 percent over the last year. Rents in Denver have increased more than 5 percent a year every year since 2010. impact of COVID-19 on housing prices has been extreme as well, where the market tallied a record high for annual closings paired with a record low of active listings. That mismatch helped push the average price for a single-family home in the Mile High City to an all-time high of $625,100 in October 2020 (the year-end average ended up at $616,895).

ADUs may be rented out as a short-term rental as long as the owner of the ADU lives on the property and maintains permanent residence there. Short-term rental income can help offset construction costs of an ADU. But a short term rental is sometimes seen as a negative by neighbors. The City and County of Denver surveyed all ADU owners, and while many of them did shortterm rent out their unit for a few years, just after construction, they eventually became tired of the requirements and turned their unit into a long-term rental for supplemental income.

The decline of nuclear families and the rise of multi-generational or group living arrangements and aging in place are deflating demand for new single-family homes. Yet, the real estate industry— operating under restrictive zoning compacts—is still catering to the traditional nuclear family household by continuing to systematically undersupply small units (particularly one-bedroom units) in favor of constructing large single-family homes. This is now exacerbating the supply and demand issue of housing - as there is a shortfall of over 100,000 homes priced at an affordable level for households making less than $20,000/year, representing over 16 percent of the entire rental stock in Colorado. It is a gap that, at current rates of affordable rental housing construction of 823 homes per year, will take over 100 years to eliminate. Despite continued population growth, an undersupply of housing, rising housing costs, and increasing displacement of residents, the number of ADUs permitted in Denver has averaged only 34 units per year since 2010.

SHORT TERM RENTAL MARKET

These ever-increasing home prices are making it so that a buyer of a median-priced home in metro Denver needs to make a salary of $70,186.63 a year to qualify for a mortgage and cover basic expenses, such as property taxes and insurance. This is causing those on fixed incomes as well as a majority of the working population to be caught in the rental market.

Often facilitated by peer-to-peer websites such as VRBO.com and AirBnB.com, shortterm rentals are residential properties available for rent for a period ranging from 1 to 29 days. Pursuant to the Denver Revised Municipal Code, the City and County of Denver requires hosts to get a license in order to offer a short-term rental in their primary residence, meaning the place in which a person’s habitation is fixed for the term of the license and is the person’s usual place of return. A person can have only one primary residence.

9 80706050403020100 ADUS PERMITTED 202520222021202020192018201720162015201420132012 denver 2019 -None 4329.73280.42147.3110.6ormore ADU Permits ADU PERMITS IN DENVER OVER TIME

The construction industry in Denver and other American cities is experiencing unprecedented increases in materials costs and shortages caused by supply chain disruptions due to COVID-19. Labor gaps are also increasing subcontractor costs and creating significant construction delays. According to stakeholders it is not an easy time to be learning and forging ahead with new ADU solutions and strategies impacted by both supply chain disruptions and rising interest increases.

This is now exacerbating the supply and demand issue of housing - as there is a shortfall of over 100,000 homes priced at an affordable level for households making less than $20,000/year, representing over 16 percent of the entire rental stock in Colorado. It is a gap that, at current rates of affordable rental housing construction of 823 homes per year, will take over 100 years to eliminate. Despite continued population growth, an undersupply of housing, rising housing costs, and increasing displacement of residents, the number of ADUs permitted in Denver has averaged only 34 units per year since 2010.

NEIGHBORHOOD CHANGE

While many communities are interested in expanding housing choices by allowing ADUs in single-family areas, some residents of these areas may be concerned about ADUs changing the character of their neighborhoods or overburdening existing Thereinfrastructure.issome concern that ADU construction will increase property values and taxes throughout a neighborhood, causing displacement, but officials in Denver, Portland and San Diego note that property values depend on many factors and properties with ADUs have little if no impact on the value of properties without ADUs.1 According to the American Planning Association, additional research does not support fears about lower property values or parking shortages. Conversely, there are some indications that ADUs do increase the supply of affordable housing and do make significant economic contributions to their host communities, through construction activity and property taxes.2 As of 2021, nearly 35% of Denverites were at risk of displacement due to being burdened by housing costs. Burdened households are those households who pay 30 percent or more of their household income on housing (such as rent or mortgage expenses).

In many of Denver’s historic, fastest-changing neighborhoods, residents are faced with a rising cost of living, while locally owned 1 ADUs in Denver Program, City and County of Denver 2 Overcoming Barriers to ADU Development, Enterprise Community Partners 3 City and County of Denver, NEST businesses struggle with increased rent costs and the need to diversify their businesses to attract new customers from the evolving community. Denver’s unique Neighborhood Equity & Stabilization (NEST) initiative was created in 2018 to preserve the culture and character of neighborhoods experiencing significant change by helping provide longtime businesses and residents opportunities to remain in place. Current efforts are focused in the following neighborhoods, in addition to any other areas of Denver undergoing large-scale development: East Colfax, Elyria-Swansea, Globeville, Montbello, Northeast Park Hill, Sun Valley, Valverde, Villa Park, West Colfax, Westwood. Currently Denver is experiencing a greater displacement of Hispanic people than any other major U.S. city.4

4 Shifting Neighborhoods: Gentrification and Cultural Displacement in American Cities, NCRC

11 Vulnerability To Displacement 2021 Least Vulnerable (41) Vulnerable (32) More Vulnerable (39) Most Vulnerable ADU_Permits_SAMECOLOR(32)ADU_Permits_SAMECOLOR(410) VULNERABILITY: WHERE HAVE ADUS BEEN PERMITTED CITYWIDE MoreLeastADUMostVulnerableVulnerablePermitsVulnerableVulnerable 2000 2016 2000 2016 HispanicMoreMostVulnerablePopulationVulnerableVulnerable DISPLACEMENT OF HISPANIC POPULATION OVER TIME

POLICY + DESIGN: DENVER METRO AREA

The building form standards for a Detached ADU are quite restrictive and can impose many cost implications that make for difficult design decisions in building an ADU.3 To build a detached ADU, a property owner must comply with the ‘ADU building form standards.’ The form standards currently do not consider different neighborhood contexts, and that can pose various challenges.

With the plan guidance of Blueprint Denver 2019, many single-unit residential properties are now 1 What’s Blocking an ADU Boom?, American Planning Association 2 ADUs in Denver Program, City and County of Denver 3 ADUs in Denver Program, City and County of Denver

SUPPORTIVE POLICY

Supportive and understandable policy sets the stage for the market to respond appropriately and can help procure more public sources of ADU funding.

ZONING POLICY

Despite general enthusiasm for ADUs as an emerging housing strategy, the market response has been several steps behind.

OF30%THECITYAND COUNTY OF DENVER IS CURRENTLY ZONED FOR ADUS

The Denver Zoning Code regulates where detached and attached ADUs are allowed and includes building form standards regarding height, minimum lot size and depth, setbacks, parking, floor area, and structure length. The zoning code also includes limitations on ADUs that further define the circumstances under which they can be built. Policy also makes it so the land under detached ADU cannot be subdivided or sold off separately, and the owner of the property must live on the property.

In order for ADUs to serve the target population of low-to-middle income households, the City and County of Denver needs to prioritize the role of zoning and design policy. In addition to looking at minimum lot size, height, parking, and other regulatory requirements, this needs to be coupled with financial programs for lower- and moderateincome households interested in building ADUs.1

According to West Denver Renaissance Collaborative, ADUs remain a relatively new typology, which means that few builders specialize in ADUs, construction practices have not been streamlined or widely used, and a limited number of lenders are familiar with the particularities of ADUs or are willing to work with nontraditional borrowers. Many community groups like the Neighborhood Development Collaborative (NDC) and The Fax recognize the importance of not only local policy but statewide supportive policy. For example, the director of NDC stated that, “the local control for inclusionary zoning that was passed as part of the 2020 Colorado Legislative Session will allow cities to change their regulatory framework in a way that is efficient and effective for them.”

ADUs are just one of many tools to inhousingincreasestockDenver.

Denver Community Planning and Development (CPD) staff note multiple reasons for the relatively low number of ADUs that have been created citywide. Staff describes that ADUs can be costly for homeowners and are not typically built unless there is family need. Many ADUs are built as part of new home construction and are rented for a while to recoup construction costs.

eligible for a rezoning to allow ADUs on their property. But the rezoning is only the first hurdle.

The City and County of Denver Community Planning Department (CPD) has kicked off their project to address current zoning barriers to ADU construction and assure that ADUs can fit into a variety of contexts: ADUs in Denver. This project will not rezone any properties, but look at how ADUs are designed, how they fit in with different types of neighborhoods and block patterns, and how updates to the zoning code may reduce barriers to creating ADUs. It will also address minimum lot sizes and consider strategies for allowing ADUs in combination with non-SU primary uses. The intent of this is to expand the number of lots that could qualify for ADUs. Studying how ADUs function in non-SU primary use zones will specifically look at how ADUs could add density in employment hubs or transit oriented development areas. This project will also evaluate and propose strategies to address certain zoning barriers to ADU permitting and construction. Some of these barriers include number of occupants per square foot, the 1.5-story limit, bulk planes, maximum building coverage and minimum setbacks. This builds off the 2021 Bundle of Zoning Code Text Amendments adopted at the end of June 2021 that added additional flexibility for detached ADU setbacks on smaller lots.

Rezoning is currently being done either parcel by parcel or through a legislative rezoning process.

Each council district has a different approach to ADUs due to the politics of the area - some areas have more pushback than others. N order to rezone a property to allow an ADU, a property owner must submit an application and pay a minimum $1,000 review fee. Some property owners, intimidated by the process, pay additional fees to hire a consultant to administer the application for them. The rezoning process takes 4-6 months and includes a staff analysis of the rezoning’s consistency with zoning code criteria and involves public hearings.

2020 TIMELINE LEGISLATIVEOF REZONING

WestBarnumBarnumWestWestColfaxHighlandSloanLakeRegisVillaParkChaffee Park2019 70% of residents who responded to the survey in these neighborhoods were in support of rezoning to allow ADUs even though 35% of those respondents would not build an ADU.

Councilwoman Sandoval underwent the first legislative rezoning process for ADUs in 2019 for Chaffee Park. Sloan’s Lake and West Colfax were rezoned with her support in 2021.

The Fax Partnership would like to see additional housing added to their district to provide options for a range of income levels, and they believe ADUs and missing middle housing are at least part of the solution. As they say, “These options need to be allowed by right, subject to appropriate and realistic design standards, and the process should begin now to encourage this.”

17 East Colfax 2022 Barnum RNO leaders said that they felt like increasing the amount of ADUs in neighborhoodtheir would not only give stock.varietyalsohousingintergenerationalfamiliesoptions,butprovidemoreinthehousing Villa Park, Barnum, and Barnum West were rezoned with support TorresCouncilwomanofinearly2022. East Colfax was rezoned at the end of 2021 with support from Councilman Herndon and Councilwoman Sawyer. East Colfax Collaborative brought up another benefit to ADUsneighborhood vitality. As they put it, “more people living in East Colfax increases the likelihood of stores, restaurants, and other neighborhood-serving retail locating in existing commercial areas.” ADU PERMITS BY YEAR Regis, ChaffeeHighlandsWestPark 1899 - 2018 2021201920202022 Barnum, Barnum West, Villa Park Sloan’s Lake, West Colfax EastBoundaryNeighborhoodDenverColfax

• Target ADUs in areas that are accessible to desirable goods and services such as Chaffee Park or Athmar Park to continue to build complete neighborhoods that are accessible and equitable. Research by Enterprise Community Partners indicates that the most important predictor of ADU production are access jobs - near employment centers and/or transit options. This was mentioned by several community organizers and aligns with the neighborhood planning initiatives the City and County of Denver are completing.

REZONING PRIORITIES

priorities:•Utilize ADUs as an important tool in increasing density in areas that may be resistant to vertical development but are more welcome to context-sensitive development. This recommendation was made by residents in several neighborhoods, and echoed by those involved with policy change.

If minimum lot size

lotswerestandardsremovednearly21,500wouldthenbeeligibletoconstructanADU.

If the City and County of Denver were to rezone certain areas before others to slowly expand ADUs throughout Denver, stakeholders identified the following

• Increase housing supply in at-risk neighborhoods, or neighborhoods of opportunity, like East Colfax and Sunnyside through ADUs while continuing to build resident wealth; currently these residents want options to add additional units in their area but do not have the flexibility to do so, as discovered through stakeholder interviews.

1. Number of occupants per square foot

RECOMMENDATIONS

Address overly restrictive zoning requirements (the below will be discussed in the ADU in Denver program, so participation in that process is paramount) such as:

1. Dedicate staff to review ADU development applications in order to reduce review cycles

1. Allowable height for at grade units

The development of ADUs is complicated, as outlined previously, but they also have great potential to build wealth and reduce displacement if the development process is more accessible. The City and County of Denver has recently started encouraging simultaneous zone lot amendment review and residential permitting to make the process more efficient. These are steps in the right direction at creating an accessible process for development, which cities like Portland have done. The following are additional possible policy recommendations:

3. Roof pitch allowances

This recommendation was developed based on conversations with builders and property owners. The permitting and review process generally results in many delays that can be burdensome for those developing ADUs on their property. The above are suggestions to mitigate those burdens.

2. Bulk plane standards

3. Centralize record keeping and allow for more flexible order of operations during permitting so that delays are minimized

4. Expedite review for all Deed Restricted Affordable Units

Continue to streamline permitting by doing the following:

The above recommendation was created after discussing with both community organizers and planners for the City and County of Denver. The zoning requirements along with context-sensitive design is being addressed through the ADU in Denver program at this time. Many of the stakeholders interviewed for this project are serving on the steering committee for that project.

4. Minimum lot size Multiple builders were interviewed - those that currently participate in WDRC’s program as well as other home builders who have chosen not to develop ADUs at this time. The above are barriers to construction as they make the design either impossible or costly.

2. Dedicate staff to address equitable site readiness issues like zone lot mismatches or unpermitted structures

: POLICY + DESIGN

2. Percent of ground floor dedicated to parking/other vehicle-related requirements

Address certain design elements that are barriers to construction, such as:

21 CONSTRUCT + FINANCE: NATIONAL CASE STUDIES

In Los Angeles, LA Mas operates an incentive program that offers homeowners optional financing, design, permitting, construction, and leasing support to build and rent a new ADU. Partnerships and non-profit funding make it possible to offer affordable design services through a design handbook of limited floor plans and choices. This minimal customization approach allows homeowners to save money on design and makes it cheaper for contractors and construction as well. - Bay Area, California

Los Angeles (LA) is the epicenter of ADU production, accounting for 11,500 of the 26,600 California ADUs permitted from 2017-2019. The distribution of ADUs are random across space, but fairly predictable across time. Access to jobs, near employment centers and transit options, is the most important predictor of ADU production. Enterprise Community Partners estimates that if production continues at 2019 levels, one in ten LA houses will have a modern ADU by 2026.

OBY Cooperative

successful include: • Design Support • Reduced Permitting Fees • Low-Interest Loans • Construction Administration • Landlord

SUPPORTIVE POLICY: CALIFORNIA

Another Bay Area ADU program, Bright in Your Backyard, is very popular since it does not have any income qualifications. The financing for this program is either a low interest construction loan or an interest only loan with the opportunity to offer three year rent caps and free project management. This program also utilizes the same approach for design - offering prefab/ modular options or low cost design services that minimize customization.

A series of laws enacted over the past five years have systematically eliminated most explicit and implicit legal barriers to ADU construction across the entire state. While Los Angeles is the epicenter of ADU production, many other cities with similar characteristics like the Bay Area have also seen explosive production of ADUs. Supportive policy includes not only zoning codes and other regulations, but also city outreach and education.make this model Registration and Training the Bay Area, OBY Coop also works with a land lease model that utilizes both community investors and a deferredpayment construction loan to finance ADUs for Section 8 residents. The construction cost is minimized through utilizing a preapproved builder cooperative with prefab design options.

Other incentives that

Affordable Small Homes - Portland, Oregon

24 Dweller, in Portland, develops and owns prefab ADUs through an innovative deferred ownership program which allows a property owner to use their existing land to build an ADU through a hands-off approach with no up-front cost for construction and still have the benefit of receiving rental income. They specialize in building modular ADUs which helps to reduce design and construction Acost.lease agreement between the developer and homeowner is in place that puts the developer as the responsible party for maintenance and construction. The ADU is built off-site using modular construction and installed on-site to reduce costs and construction time.

The Affordable Small Homes program, also in Portland, is managed and operated by a non-profit developer to target low-tomiddle income homeowners. This program provides privately financed loans through partnerships with mission-driven partners.

SUPPORTIVE POLICY: OREGON

Although Portland has had an ADU program in place for several years, ADU development was not effectively promoted until 1998, when the city amended its laws to relax the regulations governing ADUs. The amendments eliminated the minimum square footage and owner-occupancy requirements. ADUs are now allowed in all residential zones with relaxed development standards.

Portland’s regulations permit the construction of ADUs on lots with a single-family home, as long as they are supplementary to the primary residence and no more than 800 square feet. They can be created by conversion of an existing structure or by construction of a new building.

An early assistance process is available to help with project development for ADUs created through the conversion of an existing structure. ADUs that meet all the standards are permitted by right and do not require a land use review. No additional parking is required for accessory units. Portland’s ADU program guide outlines ways to bring existing nonconforming units into compliance. Portland also waives systems development charges for new construction. The collective impact of these policies was impressive - ADUs were permitted 500% more once the city removed the minimum lot size requirement, parking restrictions, encouraged multiple types of ADUs, revised the design standards, and waived any associated impact fees.”

This is incredibly important for low and moderate-income families in an area that was historically redlined and has a majority of Latinx residents with limited resources to leverage home equity.

The pilot program hopes to demonstrate that affordable ADUs, with a streamlined and cost-effective design approach, can compete with common tools such as the Low Income Housing Tax Credit, opening up opportunities for a greater diversity of federal and state funding to support affordable ADUs. By working with partners with a broader reach, such as national nonprofits, or the state housing finance agency, the WDRC ADU Pilot is able to advocate for new lending and funding options for ADUs.

The WDRC ADU Pilot program focuses on equitable access to development in historically low and moderate-income neighborhoods experiencing involuntary displacement fueled by investor speculation, new public infrastructure investments, and rising housing costs. The program is helping longtime residents invest in their properties, build intergenerational wealth, and create economic flexibility.

WDRC ADU+ Pilot - Denver, Colorado

27 MEMBERSTOOFASPROGRAMINOF83%PARTICIPANTSTHEADU+PILOTIDENTIFYHOUSEHOLDSCOLORSEEKINGHOUSEFAMILY Including an ADU as part of a ofeconomiesdownbringsconstructionnewthecoststhroughtheofscalealargerproject.

Bay Area, CA (Bright in Backyard)Your Bay Area, CA (OBY Cooperative) Portland, Homes)(AffordableORSmall Denver, CO (WDRC ADU+ Pilot) Aligned non-profits and foundations Aligned non-profits and foundations Variety of missiondriven agenciesmission-drivenpartners,developmentcommunityarchitects,andother First HumanityHabitatEnterprise,Bank,for Must rent at 100% AMI for 3 years upon completion Rent to Section 8 Will serve any AMI, but by design attracting 120% AMI, aiming for 80% AMI Focus homeownerslowertargetingonincome Homeowner Land andprivatefinancedleasethroughfoundationstrusts creditlocalfinancedHomeownerthroughbanksandunions $30,000BankthroughfinancedHomeownerFirstwitha forgivable loan, there is also a construction$30,000 waiver Free design and providedassistancemanagementprojectiswith the financing options managementwithAssistanceproperty and costslowercomponentsprefabricatedutilizingBuildermaintenance.cooperativetodevelopment Including an ADU as part of a ofeconomiesdownbringsrenovationconstructionneworprojectthecoststhroughtheofscalealargerproject. 17 7 4 2 28 OwnershipDetailsAdditional + NumberCapital of ADUs HomeownerBuilt Qualification Partners

ADUs built at market rate are usually built by tapping into personal funds or sufficient existing home equity to finance construction unless a mortgage can be used if an ADU is being constructed at the same time that the primary home is being purchased. To tap into personal funds this would require good credit scores or sufficient cash. All of these options are a challenge for low-to-middle income residents, so specific lending products that are accessible and tailored need to be created. These recommendations go hand in hand with the design and policy recommendations in order to holistically address the accessibility of ADU development. Recommendations include:

CONSTRUCT + FINANCE

Creating a builder cooperative of pre-approved, experienced manufacturers, builders, and contractors

Increasing the available lending options by creating a subsidy model, or privately financed loans, with grant funding from mission-driven partners to diversify the options available

Minimizing extraneous development costs, such as foundation engineering costs, by using a standard pre-approved foundation

use of modular home building/manufactured housing

Several cities were examined to see how they compared to Denver in terms of their market, supportive policy, and resident understanding of ADUs. The success in all of the cases below can be attributed to city-provided incentives, city-wide restriction removals, and more available and diverse financing. The cities rely on non-profit programs to help make ADUs more available and affordable to develop, as illustrated here. Therefore, the combination of these programs with more supportive policy is what has led to success in these cities.

Updating the Building Code to make it easier for homeowners to convert an existing structure to comply with new construction regulations

Working with the State of Colorado’s manufactured housing group to streamline inspections and Expandingapprovalsthe

Incentivizing ADU development with a property tax abatement or deferral

RECOMMENDATIONS:

Denver's Readiness for ADUs

Articles inside

POLICY + DESIGN

CONSTRUCT + FINANCE