Could ADUs Be A Small But Mighty Piece To Solve The County's Housing Crises Puzzle?

What if solving the housing woes of Leelanau County was as simple as letting homeowners build backyard cottages or tiny houses on their land? As local leaders look for ways to bring more abundant and affordable housing to the region – and to counteract challenges with strained housing inventory, robust real estate demand, skyrocketing property costs, and a sizable local population living at or near poverty level – accessory dwelling units (ADUs) could be the ticket to a brighter future. 

Yarrow Brown, the executive director of Housing North, calls ADUs “the low-hanging fruit” of housing reform.

“They are a way that individuals and families can contribute [to solving the housing crisis] despite not being a developer, and they are a way to add density on an existing parcel where it doesn't require a lot of changes,” she says. “We see ADUs as small square-footage homes that can help in small ways to increase housing density and housing opportunities in our communities.”

Nonprofit Housing North is dedicated to helping northern Michigan communities tackle “the systemic problems embedded in zoning laws, development financing, and public-private partnerships” that act as barriers to housing solutions. However, because current market conditions have effectively made it “impossible to build affordable housing right now,” per Brown, smaller and more incremental steps are necessary to make housing more abundant, affordable, and attainable in the region.

That’s where ADUs come in.

What exactly is an ADU? In essence, an accessory dwelling unit is just a separate residential living space that exists on the same property as a more traditional single-family home. ADUs can be attached to the main house (such as a garage or basement that has been converted into an apartment) or detached (such as a tiny house in the backyard). A few commonalities that most ADUs share: They typically sit on the same lot as a larger single-family residence, have their own private entrances/exits, and are self-contained with their own living, sleeping, cooking, and bathroom amenities.

Trudy Galla, planning director for Leelanau County tells the Leelanau Ticker, "We want to encourage communities to consider ADUs anywhere there is residential allowed. Some subdivisions and condo developments will have restrictions in place preventing them, some people may not have enough room to expand the septic for the ADU – but if we can add some in each community, that provides more housing units."

And Brown says since ADUs are typically smaller than traditional houses, they’re often an easier way to bring affordable workforce housing to a region than through traditional housing development.

ADUs can have familial benefits, too: Brown gives the example of “an aging parent who wants their kids to move back here so they can age in place.” Because housing is hard to find – and often expensive – it can be helpful in those types of situations if there are multiple dwelling units on the aging parent’s property.

The other big benefit ADU proponents often cite is income – specifically, the way that rental income from an ADU can supplement a struggling household’s cashflow enough to help them afford their own home.

The barriers to ADUs, meanwhile, tend to be related to zoning. Housing North keeps close track of which municipalities throughout its 10-county service region expressly allow ADUs, which ones prohibit ADUs, and which have no zoning language on the topic of ADUs at all. Currently, the organization’s ADU database shows just four Leelanau County communities that specifically permit ADUs: the Village of Empire, the Village of Suttons Bay, Empire Township, and Leland Township. Only one Leelanau municipality (Bingham Township) specifically prohibits dwelling in accessory buildings.

Most of the county’s other villages and townships have no ADU language in their zoning, which can be just as stifling for ADU adoption as rules that prohibit ADUs outright. With no guidance, protocol, or precedent in place, getting an ADU permitted can become a logistical nightmare, even if local zoning doesn’t technically disallow ADUs.

There is progress happening toward ADU adoption in northern Michigan, though it’s mostly not happening in Leelanau County. In Antrim County, for instance, ADUs are permitted in the majority of municipalities, including the villages of Bellaire, Central Lake, Elk Rapids, Ellsworth, and Mancelona. Similarly, most of the townships in Grand Traverse County allow some level of ADU permitting – including Acme, Blair, East Bay, Green Lake, Long Lake, and Paradise – as does the City of Traverse City itself.

The latest leap forward in northern Michigan’s ADU landscape is a brand-new ADU program that Housing North is about to launch in Charlevoix County. There, ADUs are currently permitted in the City of Charlevoix and Boyne City, as well as in parts of East Jordan. Made possible through a grant from the Grand Traverse Regional Community Foundation, the new Housing North program will provide free architectural plans to Charlevoix County residents who are interested in building ADUs. Housing North will assist property owners in navigating the ADU permitting process and will even arrange training to help program participants learn the ropes of being landlords.

With the new Charlevoix County program, by providing free architectural drawings, Housing North is hoping to remove some of the cost and logistical barriers that might preclude property owners from considering ADUs in the first place. Second, Brown notes that “by participating in the program, [a property owner] agrees to make their ADU a year-round rental, not a short-term rental,” thus preserving those ADUs as housing stock for permanent residents.

The big question, of course, is how impactful ADUs can actually be for a community and its housing inventory.

To answer, Brown points to the success story of the City of Seattle, which started allowing the construction of “backyard cottages” in parts of the city in 2006 and expanded the opportunity to all single-family zones in 2009.

The city has continued to remove regulatory barriers ever since, reducing minimum required lot sizes for ADUs, removing parking requirements, and more. The result is a robust program, one that local designer/builders have rallied behind: As of last year, Seattle has 3,928 total ADU units. More than 80 percent of those “have been permitted in areas identified as high displacement risk on the City’s Displacement Risk Index,” indicating that the program is benefitting economically-strained households.

As for the key worry that they won’t solve housing shortages for year-round residents – Seattle offers a counter point. In a 2021 report, the city estimated that just 11 percent (418 units) of its nearly 4,000 ADUs were short-term rentals. Brown says there are ways for communities to “limit out” how many ADUs become short-term rentals, whether through zoning or through programs like the Charlevoix County initiative.

As more local ADU ordinances come into focus, “making sure that all the ADUs don’t all get converted to short-term rentals is definitely really important,” Brown says. “But I do think there’s a way to create a balance [between short-term and year-round use]. And we might need that balance in order to provide support for both our tourist economy and our year-round residents. It just so happens that our communities are trying to navigate these questions simultaneously, of how to limit short-term rentals and whether to allow ADUs.”

Photo by Redd.