Are ADUs Popular Among Today's Remodelers?

Accessory Dwelling Units, commonly known as ADUs, are becoming an increasingly popular way for homeowners to make better use of their property. According to NAHB’s Remodeling Market Index, nearly a quarter of remodelers started an ADU project over the past twelve months; 24% indicated that they were building an addition for use as an ADU and 23% indicated that they were converting an existing space into an ADU. This was a large increase from the last time NAHB asked this question in 2019.

Regionally, the Northeast was most likely to have remodelers constructing ADUs, with at least one-third indicating both project types (i.e., building an addition and converting existing space). The West followed with at least 27% of remodelers for both types. Both regions have states with relatively nonrestrictive ADU laws to encourage further production. ADU projects were least likely to occur in the Midwest, with less than 20% of remodelers starting with this project type.

When asked about the evidence that helped them conclude that these projects involved an ADU, 71% indicated the project involved building a detached structure; 67% indicated the renovated area has its own separate entrance; and 58% indicated the renovated area has its own kitchen. The largest response change from Q1 2019 to Q3 2026 was for ‘Project involved building a detached structure,’ which rose 28 percentage points.

Another notable increase was in project cost. The survey found, 62% of ADU projects cost $150,000 or more, which is more than double the share than it was in Q1 2019.

For more analysis on this topic, read the Eye on Housing post.