What is an ADU?

An Accessory Dwelling Unit (ADU) is an additional, self-contained residential unit located on a residential property. ADUs are typically smaller in size compared to the main dwelling and can take various forms, including attached units like basement and garage conversions or detached structures like backyard cottages. ADUs have their own amenities, such as kitchens, bathrooms, and living spaces, allowing for independent living. They can either host family and guests of the property owner or be rented out to tenants for rental income. Unlike duplexes, ADUs are usually not separately metered for utilities and often do not have their own official address.

What are the requirements for ADUs in Boise?

The City of Boise has the following requirements for ADUs:

• Must not be larger than 900 sqft.
• Must be smaller than the primary building.
• Must have a maximum of two bedrooms.
• Can only be one ADU per property (There is an exception to this under Section 11-04-03.7.D of Boise's new zoning code)
• The design must be compatible with the surrounding neighborhood.

These are only some of the regulations regarding ADUs in Boise and it's important to review the New Zoning Code. The City of Boise also put together a great handout which answers many questions. You can view that HERE. Some of the biggest changes that the modern zoning code brought was the increase of size allowed from 700 sqft to 900 sqft, no parking requirements and the property no longer has to be owner occupied. This has been a huge change and opened up the option of ADUs to many more property owners. Particularly, for Boise investors that can now add an ADU to investment properties with unused space. The city has also made the approval process much easier, with approvals now taking about 3 months.

The Pros:

Rental Income

ADUs are the easiest and quickest way to create residential rental income, without giving up a room in your own home. Many Boise property owners are building ADU's to rent on a short term or mid term basis. Be sure to read our blog on short term rentals! It's important to remember that this boom in ADUs is going to bring a lot more supply to the short term rental market. So, make sure to be conservative when estimating the rental income you think you could receive for your ADU; there will be a lot of competition.

Flex Living Space

For owner occupied properties with ADUs, the option of having friends and family stay is a great benefit. Many owners with elderly parents, adult kids or friends and family visiting from out of town, will pause renting the ADU for this purpose. It provides the ability to live on the same property while maintaining a sense of privacy and comfort. The best part is with short term rentals, it's easy to switch back and forth between renting and hosting your guests free of charge.

Property Value

Although most applicants for ADUs have the goal of rental income in mind, it also has a positive effect on the property value. This will help when looking to sell the property or refinance the mortgage. Although, it's important to keep in mind, an ADU will not create the same value as an additional unit in a multifamily property, such as a duplex or triplex.

Affordable Housing

The City of Boise's intention in relaxing the ADU requirements is to help with the problem of housing affordability. Instead of setting aside space and resources for large affordable housing projects, they have leaned on property owners to help alleviate the issue. Whether most ADUs are aimed at low income housing or high end AirBnb's for maximum rental income, is still to be seen. Either way, they will increase housing supply, which will ultimately help the overall goal of the city.

The Cons:

Deteriorating Neighborhood Communities

ADUs can increase the density and traffic of neighborhoods. Short term rentals also bring new faces and constant change, not to mention the additional noise, parking issues and possible security risks. These are issues that have always been associated with companies like Airbnb and cities, with camps on both sides of the argument.

Living with Tenants

This is usually the biggest drawback when considering an ADU. Having other people live on your property can create an uncomfortable environment for many owners. Even if tenants will have a separate living area, possibly even a separate yard and driveway, you will be reminded that they are there and your home will undoubtedly lose some of its privacy. You will also experience a loss of space from your current living situation. Whether that be a garage, storage shared or side yard, it's important to consider how much you currently value these and if you are willing to lose them.

Becoming a Landlord

Managing an ADU will be time consuming and create headaches. No matter, how slick the system or how much you think it will be on auto-pilot, it will take a level of work. It's important to treat it as a profession as there are many laws and regulations you need to be aware of to remain compliant and not have any legal issues arise.

Is an ADU the right choice for you?

The decision to build or convert an ADU is multi-faceted with many pros and cons. However, it's clear that ADUs in Boise are already becoming a part of all Boise neighborhoods and will continue to become more and more popular. The new Boise zoning code has accelerated these changes and made ADUs a great option for many property owners in Boise. There are even construction companies that specialize in ADUs, making the process from ADU application to tenant placement that much more seamless. Be sure to reach out to your local professionals for more guidance and insights!