This Vancouver laneway house was one of the first built after the city approved them in 2009. Krista Jahnke/Lanefab

Vancouver leads North America in accessory dwelling units. To fight a shortage of affordable housing, some U.S. cities are following suit.  

Earlier this month, the city of Vancouver opted to forego a new housing rule that would have restricted homeowners from demolishing their pre-1940 houses and constructing larger dwellings in their place. While preservationists naturally supported the idea, the outcry from many residents persuaded the city’s planners to let it go.

In Vancouver, the world’s third most expensive housing market, residents are desperate for more—and more affordable—places to live, especially in the city’s central neighborhoods, where single-family homes sell for millions of dollars. Some residents feared that the rule would freeze these neighborhoods in time, preventing larger buildings, which could house more people at lower rents, from ever being constructed. The city’s planners say their focus is now on adding more types of housing, such as townhouses, to these single-family zones.

Vancouver has also been promoting densification and affordability in neighborhoods with single-family homes by making way for accessory dwelling units (ADUs). The city made renovations that create a duplex unit—such as a granny flat or basement apartment—legal in 2004. Then, in 2009, it added “laneway houses,” or alley-facing cottages of 500-1,200 square feet, to the ADU menu. Laneways, which go for an average of around $1,250 a month, have been so popular that the city now has more than 2,000 of them. And more than a third of Vancouver’s single-family homes now have a legal ADU.

While ADUs won’t solve Vancouver’s affordable housing problem, they make attractive options for individuals, couples, or small families looking to live in walkable, sought-after neighborhoods they could not otherwise afford. They also offer housing options for those wanting to “age in place.” Older residents can give the main house to their children and live in the ADU, or they can have a caregiver live in the ADU while they remain in the main house.

Though North American cities already have thousands of ADUs, they’re mostly illegal. The push to get them on the books can seem counterproductive, as illegal ADUs, though less likely to have safety features such as dedicated fire exits, are also generally less pricey. “Homeowners are apt to charge more rent in order to recoup the cost of constructing ADUs according to current building code standards,” says Kol Peterson, a Portland, Oregon-based expert on ADUs. Most planners and researchers agree, however, that legalizing ADUs is a positive development, as it encourages homeowners to build them—and build them well.

Peterson says there’s also an environmental advantage. Because this type of housing is inherently small, it doesn’t require as much heating or cooling as a standard-sized house—lessening the most significant factor in a residential carbon footprint.

Garage apartments are another type of accessory dwelling unit (ADU). (radcliffe dacanay/Flickr)

Vancouver’s success with ADUs is largely due to the absence of strict codes that hinder homeowners from building them, such as requiring an off-street parking space for each unit. The city also allows a homeowner both a laneway house and a duplex arrangement. “The U.S. and Canada have a legacy of preserving single-family housing, and it’s time to move away from that,” says Nathanel Lauster, the author of The Death and Life of the Single Family House: Lessons from Vancouver on Building a Livable City. “Vancouver is the city moving furthest and fastest in that direction in part by having changed its laws.”

Some U.S. cities with surging housing prices are moving in the same direction. Though Portland, Oregon, legalized ADUs back in 1981, its residents didn’t build many of them until 2010, when the city relaxed its codes. Portland now has 1,800 units on the books. Peterson notes that the mandate for off-street parking is among the most important to strike if a city wants more granny flats. Because the state of California just relaxed its ADU codes, including parking, “we’ll likely see a lot more ADU development in California cities,” he says. Less expensive and smaller cities like Austin and Durango, Colorado, are similarly looking to spur ADU construction through more flexible rules.

ADUs have the advantage of support from opposite ends of the political spectrum: Progressives love how green they are, and conservatives tout them as a free market housing option. But there are plenty of people who aren’t so keen on seeing their proliferation. NIMBYs are perhaps the biggest foes of the granny flat. Worries about new buildings or configurations changing an area’s aesthetics, and new tenants clogging up streets with their cars, spur neighborhood groups to stymie ADU-friendly housing rules.

Dan Bertolet, an urban housing researcher in Seattle, says a neighborhood group recently blocked a citywide affordable housing proposal that included loosened restrictions on ADUs. “Their objection was that there wasn’t enough study of the impacts on neighborhood character, most notably parking,” he says. The city must now undertake more analysis, but Bertolet is optimistic that the proposal will ultimately be approved. “At some point Seattle is going to implement these changes,” he says.

Residents also fear that ADUs will be used as short-term rentals, such as via Airbnb, transforming neighborhoods into hubs of the hospitality industry and exacerbating the dearth of affordable housing. Vancouver is currently mulling over a ban on short-term ADU rentals. In the U.S., the rules vary. Portland allows them, provided owners seek a permit and get an inspection, while Austin is no longer accepting applications for short-term ADU rentals. Regardless, Bertolet says the use of ADUs for services like Airbnb has a negligible effect on rents citywide, and Peterson believes that ADUs should be decoupled from the issue of short-term rentals. “Short-term rentals will happen whether or not ADUs are there,” he says.  

If U.S. cities follow in Vancouver’s footsteps, we’ll see more and more granny flats, basement apartments, and the like—and NIMBYs might even change their minds about them. Lauster says many of those in Vancouver who initially hated the idea of laneway houses—grumbling, for instance, that the small cottages would interfere with their enjoyment of walking in alleys—eventually came around. Complaints are now few, and there are even laneway house tours. “It’s actually nicer to walk in the alleys than before,” he says.

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