Do a search for online news about accessory dwelling units, or ADUs, and you’ll come up with dozens and dozens of results of many markets considering opening up regulation to allow them in order to offer more affordable housing.
Around D.C., in areas such as Arlington, Va., zoning changes are now under consideration that allow construction of new, detached accessory dwelling units. In Oregon, a new state law mandates that all cities with 2,500 or more people allow ADUs on the same property with a primary residence. In Washington, the state legislature just advanced a bill that could be the most pro-ADU reform in any state. Across the coast, towns in New Hampshire are also changing zoning regulations specifically to allow ADUs. The list goes on and on.
One company at the forefront of the ADU movement is Dweller, an ADU builder, designer and developer. The Dweller process is unique because the company can help the homeowner finance an ADU with an innovative rent share program. The homeowner provides the land, Dweller provides the ADU, and the rent is divided up.
The solution, made to combat lack of affordability, also faces the same adversities as other home building. A visit to the Dweller site shows a message that the company is raising prices on the ADUs by $5,000 to $130,000 on April 1, 2019, another measure to try to absorb continually raising construction costs.
Patrick Quinton, co-founder and CEO of Dweller, was a HIVE Top 5 Innovator at the conference in November and explains the model in this short video.
While ADUs continue to be an affordability solution, the marketplace is still very dynamic. Oregon, for instance, just became the first state in the U.S. to enact statewide rent control, limiting rent increases to a maximum of seven percent annually. While the rent control bill proposed in California didn’t apply to single family rentals, it does apply in Oregon.
"While we believe Oregon’s new rent control and tenant protections law represents a moderate approach to protecting renters in this market, it will have the effect of decreasing housing production over time," Quinton says. "Anything that creates uncertainty for landlords and investors will keep some people on the sidelines. We are still confident in the market for ADUs in Oregon and have not adjusted our growth plans as a result of the legislation."
The state also has outlined a plan for a $400 million investment directed to helping the homeless and increases housing supply, specifically affordable housing options, in the next three years. If the plan is approved, there may be more support for innovations such as Dweller’s ADU solution.
RIght now, Quinton plans to take Dweller units outside of Oregon by the end of the year.