Though Massachusetts has made it easier recently for property owners to build accessory dwelling units behind or adjacent to their houses, a new report says the state still has a lot of work to do if this housing type is to have a meaningful impact.
The state should preempt local government restrictions on ADUs, ease up on safety and environmental rules, and train appraisers to value these houses properly, among other reforms, according to the Pioneer Institute, a Boston-based nonprofit research group.
Massachusetts should aim to replicate the success California has had in building accessory dwellings, the report said. The Golden State saw more than 83,000 of these houses completed between 2018 and 2024, according to report author Andrew Mikula, including one of every four new homes permitted last year. Massachusetts data show that 550 ADUs were approved across the state in the first half of 2025.
In August 2024, Massachusetts Gov. Maura Healey signed a housing bond bill that included language legalizing accessory dwelling units in neighborhoods across the state. But the way that section of the bill was written means local governments still have too much authority to block these homes, Mikula said.
For example, a city or town can require that accessory dwellings have their own parking spaces, unless they’re within a half mile of a train or bus station.
“Hypothetically, most new housing development will increase the need for parking to some extent,” Mikula wrote. “But many ADUs aren’t used as housing, and still others are used to house people who don’t own cars. It should be up to the owner whether to include parking in the first place. Otherwise, parking mandates will just increase costs and deter ADU production.”
The state also allowed communities to impose building setbacks that are as stringent as those for the main single-family house on a lot. So, if the main house is set back 20 feet from the property line, the accessory unit has to be, too. These types of rules can make it difficult or impossible for homeowners to build these units, Mikula said.
State’s largest city has lagged in building ADUs
Another issue is that the state’s largest city, Boston, is effectively exempt from the 2024 reforms because it’s not subject to the state’s zoning act, according to the report. While Boston has made some legal changes to allow more accessory homes, the results have been disappointing, with only 212 of these units permitted between 2019 and July 2025.
California has some advantages that have allowed it to ramp up accessory unit production, the report said. Many of the state’s houses have backyard garages that can be easily converted into accessory homes. Many homes also have alleys behind them, which addresses fire officials’ concerns about gaining access to rear-yard houses in an emergency. Mikula said Massachusetts should allow an exemption from standard fire codes to encourage the construction of accessory dwellings.
The state can also do more to help owners finance accessory dwellings, the report said, since this type of housing is not eligible for traditional 15- or 30-year bank mortgages. One way to make it easier for owners to access this type of financing is to allow them to sell accessory units separately from their primary dwelling. California has allowed this since 2023. Appraisers also need education to value accessory homes properly, the report stated, as they sometimes struggle to find comparable residences nearby.
Mikula said in a statement that Massachusetts’ 2024 reforms were a great first step, but the state needs to do more.
“Without actionable policy changes, young people will continue to leave Massachusetts in droves, and many older adults will be trapped in large homes that no longer suit their needs,” he said.