After a nearly seven-decade ban, the city of Chicago has unanimously approved expanded construction of accessory dwelling units, aimed at increasing the affordable housing inventory.
Accessory dwelling units — often referred to as ADUs, granny flats, in-law suites and coach houses — are housing units built or converted within the property of an existing home. These could be tiny homes in backyards, converted and habitable basements or attics, or even multiunit buildings behind an existing residential structure.
All of these were approved in Chicago on Thursday, reversing a 1957 ban. Before 1957, ADUs were common throughout the city.
What type of units and if a homeowner can even build one depends on their location, specifically impacted by zoning requirements and alderperson approvals. Alderpersons in Chicago are 50 local legislators who make up the City Council and represent their ward.
For example, ADUs will not be permitted in single-family zoned neighborhoods unless an alderperson applies for and receives special approval for the neighborhood. With that approval, there can be limits on how many units are built per block. In all other residential zoning, ADU construction is allowed outright.
Alderpersons have long had final say on zoning in their wards, and this approval maintains that, allowing officials to create restrictions on ADU construction. Some restrictions include requiring the principal home to be owner-occupied and limiting the number of units built per block.
How the ADU approval plays out ward-to-ward will be known in the coming months as they submit proposals.
City requirements
Potential blanket restrictions or requirements for ADU construction include, but are not limited to:
- ADUs cannot be built before the principal home.
- Every second ADU must be rented at an affordable rate to households earning up to 60% of the area median income.
- Homeowner applicants must pay $500 per affordable conversion unit.
- Homeowners must work with a union general contractor and subcontractors who participate in nationally recognized apprenticeship programs.
- Converted spaces within a home are limited, depending on its size.
Why the push for ADUs?
Housing activists have long called for approval of ADUs across the country, and Chicago joins a list of cities and states, including nearby suburban Evanston, Illinois. Oregon, Colorado, Connecticut, California, Maine and Washington are among the states with approved ADU policies.
These units are typically smaller and could provide additional income to homeowners that take on tenants, helping homeowners with their payments while providing an anticipated lower cost housing option into the greater inventory.
In Chicago, the affordable housing shortage amounts to nearly 300,000, according to nonprofit group Housing Action Illinois.
“ADUs help us create more homes without displacing residents or reshaping neighborhoods, and they give homeowners the tools to build stability, support loved ones and invest in their communities,” said Department of Housing Commissioner Lissette Castañeda in a statement. "This is how we grow housing supply with urgency and equity.”
In 2021, Chicago began an ADU pilot program in five areas, making construction eligible for 116,000 parcels. Nearly 400 units were built since, according to an analysis by real estate information website Chicago Cityscape.
With this new approval, about 245,000 parcels are eligible for ADUs, according to the city.