PDX Additions

Portland Gives ADU-builders Another Two-year Reprieve

Mother-in-law cottage, guest house, rentable space – I talk frequently with local homeowners about whether creating an ADU is feasible for them. ADU is the acronym for Accessory Dwelling Unit. This can take the form of a small house on your property, a converted attic, or a finished basement which can serve as a stand-alone housing unit. Typically, it would include a sleeping space, a full bathroom, a kitchen, and all the proper light, ventilation and emergency exiting requirements (egress) that you would expect from any residential living space.

Having an ADU can be a great way to enhance your property if you have the space and the budget. You can use it as a rentable space for a tenant, as a home for a relative (popular for Grandparents who want to be close to their children and grandchildren), as a guest house or a short-term rental. There have even been Portlanders who want to downsize their living space but stay on their property and in their neighborhood. They build an ADU in their backyard or convert an existing detached garage, live there and rent out the main house.

ADUs have been an instrumental factor in keeping density high while allowing people to stay in their homes and boost their property values. One incentive to build has been the waiving of the SDC fees by the Portland City Council. The System Development Charges pay for all kinds of city infrastructure elements. When you are building a new home on previously undeveloped property, you will pay these charges. They pertain to water, roads, sewers, and parks. After all, you wouldn’t want to build in the city if you didn’t have access to those things. However, in the case of an ADU, the property has already paid those charges (in theory) when it was built. And the main property also continues to pay for these things through taxes. So, rather than apply those fees again in regards to an ADU, they have been waived. For some projects, this can amount to a $10k boost – for an 800 sf structure (or smaller), this can be a real budget booster!

As we neared the sunset of this waiver in 2016, homeowners have been frantically trying to get their permits in under the wire. I know from my colleagues that the demand for ADUs has been in a fever pitch this past year. So I’m really happy that the City Council has granted another two-year reprieve. It will expire on July 31, 2018. Read more about the waiver and other ADU information at the information-rich AccessoryDwellings.org blog.