What Is an ADU in NYC? A Beginner’s Guide to Accessory Dwelling Units
So… you’ve heard the buzz.
Possibly your neighbor discussing plans for their basement conversion. Or your cousin in Brooklyn flexing on side rents. Or maybe you caught a glimpse of a slick tiny cottage in someone’s backyard online and thought, “Wait… can I really make one of those happen in New York City?”
The ADU movement is starting to happen quietly in NYC!
So, let’s get real about what ADUs are, why they matter, and most importantly, if you can actually build one on your property.
What Exactly Is an ADU?
An ADU, which stands for Accessory Dwelling Unit", is like a “home within a home”.
It is an independent and complete living accommodation on the same property as a primary residence. It contains a kitchen, bath, and sleeping area. And yes – it can provide legal accommodation for someone else (or you, if you’re down-scaling and renting the principal residence).
ADUs come in all shapes and sizes:
A finished basement or cellar apartment
A converted garage
A backyard cottage (yes, even in Brooklyn!)
An attic studio with a mini-kitchen
A “mother-in-law suite” above a detached garage
They’re not new—people have been squeezing extra units into NYC homes for decades. But until recently? The majority of them did not do so legally. Shades of gray. Unauthorized. Dangerous.
Today, ADUs have the benefit of new city and state regulations, rules, guidelines and even incentives.
Why NYC Suddenly Cares About ADUs
The truth is, New York is in a housing crisis. Rent prices are exorbitant. Families are doubling up. Seniors are unable to age in place. And the youth? A lot of them are just… leaving. By legalizing and encouraging ADUs, NYC can:
Create affordable housing without building skyscrapers
Help homeowners earn extra income (hello, mortgage relief!)
Support multigenerational living (grandma moves in—but with privacy)
Reduce urban sprawl by using existing lots more efficiently
Can You Build an ADU in NYC?
Good question. In short, the answer is: Yes, but it depends.
So, what does this mean?
1. The type of property you own
ADUs are permissibly located on lots that contain a one- or two-family home. This means that most one- or two-family homes in the outer boroughs (Queens, Staten Island and parts of Brooklyn and the Bronx) are up for grabs.
So long, Manhattan skyscrapers. ADUs do not apply to buildings containing co-ops, condos, or more than two units.
2. Size & Location Apply
An ADU cannot exceed primary house in size
In many cases, it must be smaller than 800 square feet.
If it’s detached (like a backyard cottage), it usually can’t take up more than 33% of your rear yard.
It must meet light, ventilation, egress, and fire safety codes—no windowless basement dungeons allowed.
3. You will have to get permits.
Now is not the time to make it up as you go along. The risks associated with unpermitted units include fines, eviction orders or most importantly, hazardous living conditions.
The good news?
NYC has plans to simplify the approval pathway. There may even be grants or low-interest loans forthcoming to assist with the conversion costs, particularly for low and moderate-income homeowners.
Takeaway - The Pros (and Cons) of Adding an ADU
✅ The Upsides
Additional monthly income: $1,500-$3,000/month based on location & size. That is a lot for a city when every dollar matters.
Flexible family living: Without compromising privacy, house aging parents, adult children, or caregivers.
Increased home value: Having a legal rentable unit increases the desirability of your home and makes it more marketable in the event that you want to sell.
Impact on the community: You are literally part of the solution for the housing crisis –one backyard cottage at a time.
❌ The Challenges
Upfront costs: Renovations require some serious cash. Consider $50K- $150K+, based on scope.
Zoning headaches: The NYC regulations are still developing. What is acceptable today may change next year.
Tenants: When you rent it out, you are a landlord. I.e., leases, repairs, legal claims… etc.
Neighbor pushback: Some folks worry about parking, noise, or “changing neighborhood character.” Be prepared to communicate.
Second Key is here to guide you every step of the way. Let’s unlock the full potential of your NYC property—seamlessly, smartly, and beautifully.
Start your ADU journey today with a free property assessment.