What is an ADU, actually?

An accessory dwelling unit is a second, smaller home on a lot that already has one — and in Colorado, as of 2024, most cities have to let you build one. Here’s the plain-English version, before anyone tries to sell you something.

The short definition

An accessory dwelling unit (ADU) is a secondary, independent living space located on the same lot as a single-family home. It has its own entrance, kitchen, bathroom, and sleeping area — everything needed to live there full-time, separate from the main house.

You’ll also hear it called a granny flat, in-law suite, backyard cottage, or carriage house. They’re all describing the same basic idea: a smaller, self-contained home tucked onto a property that already has a bigger one.

What an ADU is not

Not a home addition. An addition (a new bedroom, a sunroom) extends the main house and shares its systems. An ADU is functionally a separate home.
Not a duplex. Duplexes are typically two roughly equal units, often under different zoning rules and sometimes on separate titles. ADUs are secondary to a primary residence.
Not automatically legal everywhere. Colorado's 2024 state law set a floor, but local zoning still determines size, placement, and permitting specifics — see our Colorado ADU law guide.

The four main types

Every ADU falls into one of four broad categories, mainly distinguished by where it sits relative to the main house. We cover the tradeoffs of each in detail in our ADU types comparison — the short version:

Detached ADU — a fully standalone structure, often in the backyard. Most privacy, most flexibility, highest cost.
Attached ADU — built onto the main house with its own entrance, sharing at least one wall.
Garage conversion ADU — an existing attached or detached garage converted into living space. Often the most budget-friendly path since the structure already exists.
Basement / interior ADU — a self-contained unit carved out of existing square footage, with a separate entrance added.

Why Colorado is different now

In 2024, Colorado passed HB 24-1152, a statewide law that requires many cities — including Denver — to allow at least one ADU per single-family lot, and prohibits some of the more restrictive local rules (like blanket owner-occupancy requirements) that used to keep ADUs off the table entirely. That doesn’t mean every rule disappeared. Setbacks, size caps, parking requirements, and design review still vary block to block. We keep a living breakdown of exactly what changed and what didn’t in the Colorado ADU law guide.

Common reasons people build one

Rental income — Denver's removal of owner-occupancy requirements has made long-term ADU rentals more viable than ever.
Aging in place / multigenerational living — housing a parent or adult child nearby, with independence on both sides.
Home office or studio — a fully separated workspace, without commuting.
Long-term property value — added livable square footage that (unlike a renovation) can generate income on its own.

Glossary of terms

A few terms that come up constantly in ADU research, defined once so you don’t have to guess later:

Term	Definition
ADU	Accessory Dwelling Unit — a secondary, independent home on a single-family lot.
JADU	Junior ADU — a smaller unit (often under 500 sq ft) typically created within the walls of the existing house, with a shared or separate entrance.
Setback	The minimum required distance between a structure and the property line.
FAR	Floor Area Ratio — the ratio of total building square footage to lot size; used by some zoning codes to cap how much you can build.
By-right	Allowed under current zoning without needing a special variance, rezoning, or public hearing.
Owner-occupancy requirement	A rule requiring the property owner to live in either the main house or the ADU; Denver has removed this requirement.