The term ADU is being tossed around more and more often, but do you know what ADU really means? It’s short for accessory dwelling unit, or basically a fancy word for what most of us think of as guest houses, mother-in-law units or garage apartments.

If you’ve ever looked out at your yard, or inside your crawlspace or rec room and thought: I wonder if I could do something more with this space? The answer might be to turn it into an ADU.

ADUs might seem like a new-ish trend, but the concept of standalone living quarters isn’t. The term itself has been floating around since the 1980s, and recently, ADUs gained serious traction as part of the solution to the housing crunch. In simple terms, an ADU is a fully independent unit complete with the basics: its own kitchen, bathroom, and sleeping area that can only exist secondary to your main house.

So, what’s all the buzz about them? ADUs are more than just a cool backyard project, they’re a game-changer. Maybe you’re thinking about downsizing but love where you live. Maybe your parents need to be closer, but not too close. Or maybe your adult kids are back home trying to save up for their own place (because let’s be honest, housing prices aren’t getting any cheaper). Beyond personal benefits, ADUs are also backed by state law as a tool to tackle the housing shortage. That means they’re intended for long-term housing, not short-term vacation rentals – so if you were dreaming of an Airbnb side hustle, this isn’t the route. The goal here is stable, sustainable housing that fits different income levels, life stages, and household needs.

Real estate prices in the Tahoe-Truckee region keep climbing and finding an affordable investment property or helping a family member buy a home can feel nearly impossible, but adding an ADU is way more doable. Yes, it still is a significant investment, but compared to buying another property, it’s a smart long-term move. It can add value to your home, create a reliable rental income, and contribute to the local housing market. All without drastically changing the character of the community.

For homeowners who love the area but don’t live here full-time, an ADU can be a great way to stay connected to the community. Renting it out to a local worker or hiring a caretaker ensures the property is well maintained and contributes to a vibrant neighborhood.  

Concerns about density and parking often arise, but ADUs are a thoughtful, gentler housing development option that blend into neighborhoods without overwhelming them. If you’re curious about building an ADU, the Tahoe Housing Hub’s ADU Accelerator Program offers free step-by-step support to walk you through the entire process. With the right guidance, turning an underutilized space into a livable unit becomes much more achievable.