Accessory Dwelling Units (ADUs) – small, independent living units that are inside, attached to, or detached but on the same parcel as a primary residence – have the potential to address such housing-related challenges as affordability, equity, and sustainability. Consequently, many localities and a few states have recently made it much easier to build ADUs and many other places, including Massachusetts, are considering similar changes.

In “Accessory Dwelling Units: Lessons for Massachusetts from Around the Country,” we examine what policymakers considering changes to their ADU-related laws and regulations might learn from state and local efforts to encourage ADUs. While we review changes from around the country, we primarily focus on two locales: Portland, Oregon, which has embraced ADUs (and, in doing so, has become a model for statewide legislation), and the state of New Hampshire, which has taken a more measured approach to ADUs.

We begin by noting that despite their potential benefits, many homeowners oppose efforts to allow ADUs, usually because of concerns about traffic, neighborhood character, and property values. Since homeowners tend to play a major role in local politics, and since land use regulation predominately occurs at the local level, some communities ban ADUs while others only allow them via special permitting processes. As such, many by-right and special permit ADUs often include onerous restrictions, such as limiting occupancy of the ADU to family members, requiring that the ADU’s owners live in the primary residence or the ADU, and/or mandating that the ADU have one or more on-site parking spaces. This can create a self-reinforcing negative cycle in which few homeowners know about ADUs, few lenders offer appealing products to finance them, and few builders specialize in constructing them.

Despite such challenges, over the last two decades, many cities and towns have changed their zoning to allow by-right approval of ADUs that meet clear standards for their size and use. Moreover, in the last decade, several Western states, starting with California and Oregon, have passed laws that require by-right local approvals of ADUs that meet state standards and limit localities’ ability to impose restrictions on occupancy or require substantial amounts of parking. (Table 1)

Our research finds that such robust changes can have dramatic impacts. In Portland, annual permitting of ADUs grew from about 25 ADUs in 2009 to roughly 300 in the past few years. Similarly, permitting of ADUs in California has grown from less than 1,300 units in 2016, when ADUs represented less than one percent of new housing permits, to almost 25,000 units in 2022, when ADUs accounted for 18 percent of all new housing units.

While several New England states have also passed ADU-related laws in the last decade, they have taken a far less prescriptive approach. For example, a 2016 New Hampshire law and a 2022 Maine law both require that local zoning allow for ADUs but do not require by-right approvals. A 2020 Vermont law does require by-right approvals but also allows communities to impose occupancy restrictions and parking requirements. A 2021 Connecticut law mandates by-right approvals but also allows cities and towns to opt out of those requirements, while a 2022 Rhode Island law requires by-right approvals, but only for ADUs occupied by family members, on large lots, or in existing buildings. It doesn’t appear as though these laws have produced many new ADUs. For example, in New Hampshire (which does not collect statewide data on ADUs), our review of policies in Manchester, Portsmouth, and Dover found only a modest number of ADUs had been built in those cities. And two-thirds of Connecticut’s localities have taken advantage of the opt-out provisions in the state’s ADU law.

Taken as a whole, three insights emerge that might help inform policymakers in Massachusetts (and other states) considering changes to laws that govern the regulation of ADUs:

• Significantly increasing the production of ADUs requires the passage of statewide legislation mandating by-right, local approval of ADUs that meet meaningful state standards related to their size and design.
• Policymakers must choose between a comprehensive approach that may limit communities’ ability to impose occupancy restrictions and parking requirements, or an incremental approach that does not include those limits. The former approach is likely to produce more units and more controversy; the latter will produce fewer units but might be more politically acceptable.
• Meaningful by-right permitting processes will catalyze efforts such as homeowner education programs and new loan products that will help overcome other barriers to ADUs.

ADUs alone cannot fully address a host of housing-related challenges. However, they can be an important part of meaningful comprehensive efforts to address them.

Notes:

* Laws passed earlier in California, Washington, and Vermont had required that localities allow for ADUs but did not require by-right approvals.

** Connecticut’s law requires by-right approvals. However, it also allows localities to opt out of this provision with a two-thirds vote of both their planning board and legislative body.

*** Rhode Island requires by right on owner occupied lots for family members, on large lots, for internal ADUs, or for an ADU within an existing accessory structure.

Sources: Hamilton and Houseal, “A Taxonomy of State Accessory Dwelling Unit Laws” and Georges, “Five Key ADU State Bills.”