- topics | Financing
ADU Aid Programs Across the U.S.
Cities and housing advocates nationwide are launching programs to support ADUs as a practical fix for housing shortages. Below is a snapshot of financial aid and support initiatives available today. While this list highlights several programs, it’s not comprehensive. Programs are emerging and evolving all the time! If your area isn’t mentioned, we encourage you to check with your city or county’s website for the latest local offerings.
Programs incentivizing accessory dwelling units are popping up from coast to coast, as local governments and coalitions seek real solutions to housing shortages. Here we’ll cover several ADU financial aid and other support programs throughout the country. The list isn’t exhaustive though, and many more initiatives will likely emerge over time, so check your local websites if your area isn’t listed.
Boston, Massachusetts
Program: Boston Home Center ADU Financial Assistance Program
This program offers staff support and financial assistance to income-eligible homeowners of 1-3 unit homes who are planning to build an ADU in their home or on their property. Income-eligible homeowners may apply to the ADU Financial Assistance Program to receive both a grant and a loan to help with costs to design, permit, and build their ADU. If eligible, homeowners may also apply for additional financing with one of our partner lenders.
El Cajon, CA
Programs: ADU Loan Program
The City of El Cajon’s ADU Loan Program provides financial assistance for homeowners to build an ADU on their owner-occupied property. The financial assistance is a deferred loan that requires repayment in the future and assists with construction costs only. ADUs built with help from the program are required to remain affordable for a minimum of 5 years. City staff will assist the homeowner through the loan process and provide technical assistance.
Los Angeles (City)
Programs: The Backyard Homes Project and the LA ADU Accelerator Program
A venture of LA Más and its partners, the Backyard Homes Project offers support and incentives to homeowners who agree to rent their ADUs as Section 8 housing (that is, to very low-income residents). Incentives include free project management, affordable design and construction services, and landlord training.
With the LA ADU Accelerator Program, homeowners who rent their ADUs to older residents at an affordable price get qualified tenant referrals and stable rent payments. Will the City of Angels one day be the City of Aging in Place?
Los Angeles County
Programs: Second Dwelling Unit (Accessory Dwelling Unit) Pilot Program and Yes to ADU
Backyard homes in L.A. County are ready for their close-up! The pilot program provides a subsidy of up to $75,000 per ADU in the form of a forgivable loan to homeowners who agree to rent to a homeless family or someone with a housing choice voucher. The arts-based Yes to ADU initiative is designed to raise awareness about ADUs in general.
Mad River Valley, Vermont
Program: Accessory Dwelling Unit Program (ADUP)
Launched in 2020, this initiative of the Mad River Valley Housing Coalition offers construction grants up to $10,000 for the building of ADUs, as well as professional support. Homeowners must rent out the unit at an affordable rate for five years. Home to the popular Sugarbush ski resort, the Mad River Valley is now also a happier home for ADU advocates!
Marin County, California
Program: ADU Fee Waiver Program
Through December 2026, the County is offering the following fee waivers for the development of ADUs and JADUs. To qualify for the waiver, you will need to affirm that the ADU/JADU will not be used as a short-term rental. To receive the $5,000 or $10,000 waiver, you will need to place a deed-restriction on the property confirming the unit will be rented to a household at the income level specified.
Portland, Oregon
Program: Development fee waivers
The City of Portland’s ADU SDC Waiver Program helps homeowners save money by waiving System Development Charges on new accessory dwelling units. To qualify, owners must agree not to use the ADU as a short-term rental for 10 years and record a covenant to that effect.
Program: Energy Trust of Oregon Accessory Dwelling Units Incentives
Energy Trust of Oregon offers performance-based incentives for energy-efficient ADUs that receive an EPS (Energy Performance Score). Eligible ADUs must be newly constructed, meet local permitting and size requirements, and be intended for long-term occupancy. Builders must coordinate with an approved verifier during design and construction to ensure compliance. Additional incentives are available for solar-ready or net-zero energy ADUs.
Santa Cruz, CA (City and County)
Programs: Habitat for Humanity: My House My Home
My House My Home is a partnership between senior homeowners, Habitat for Humanity Monterey Bay, and the City of Santa Cruz to build or renovate ADUs on seniors’ properties. The program helps low-income seniors age in place, generate rental income, and create affordable housing for others.
Monterey, CA
Program: Habitat for Humanity: My House My Home
My House My Home is a partnership between senior homeowners, Habitat for Humanity Monterey Bay, and the City of Santa Cruz to build or renovate ADUs on seniors’ properties. The program helps low-income seniors age in place, generate rental income, and create affordable housing for others.
San Diego, CA
Program: San Diego Housing Commission ADU Finance Program
San Diego’s Housing Commission offers up to $250,000 in low-interest loans and free support to help income-qualified homeowners build ADUs. In exchange, units must be rented at affordable rates for up to seven years. The program also provides pre-approved ADU plans to simplify construction.
Program: ADU Bonus Program
Homeowners can build extra ADUs—called “bonus ADUs”—if they agree to rent some ADUs at affordable rates for at least 15 years. For every affordable ADU you build, you can build one additional bonus ADU—and there’s no cap on how many you can build within Transit Priority Areas (TPAs). Outside TPAs, you can still build one bonus ADU for every affordable ADU, but no more than that—so you’re limited to a one-for-one exchange.
Seattle, Washington
Program: The Block Project
Seattle is regularly named one of the top 10 richest cities in America—and regularly has one of the highest homeless populations. So it’s about time someone is leveraging the benefits of ADUs. The Block Project builds sustainable homes in underutilized backyards to combat homelessness in a dignified, supportive, and environmentally friendly way. It has an impressive network of partnerships with social service agencies, businesses, volunteers, and funders, including the grungy but socially conscious band Pearl Jam.
West Denver, Colorado
Program: West Denver Single Family Plus (WDSF+)
The West Denver Renaissance Coalition (WDRC) doesn’t just offer WDSF+ pilot program to help low- and moderate-income homeowners finance ADUs. It offers work sessions to walk people through financing and site prep, a handy guidebook to building ADUs specifically in West Denver, and a website with info in both English and Spanish. What it doesn’t have: a short and catchy name for its ADU initiative.
And that’s not all, folks
Other cities are promoting ADU building with expedited processing of permitting applications for pre-approved plans, nonfinancial incentives (such as exceeding the maximum square footage), and a slew of resources to guide homeowners through the building process. Reach out to your local government and any advocacy organizations to see if any would benefit you!
Performance, estimates and/or projections provided in this article intended for illustrative purposes only and are not indicative of future results. Prospective customers, builders, investors, and readers should conduct their own independent investigation. Villa expressly disclaims all claims and liability that may be based upon or related to the information provided herein.