Zoning decides your ADU, not your budget.
Whether an accessory dwelling unit is legal on your lot, what type, and how big — those answers come from your parcel and your jurisdiction. Everything else is downstream of them.
Almost every ADU conversation starts with a budget number and a picture. It should start with a zoning check, because zoning — not money, not design — is what decides whether the thing you are imagining is legal on your lot at all.
We have had this conversation many times, and the pattern is consistent: people arrive with a plan and a price in mind, and the first genuinely useful thing anyone can tell them is whether their parcel permits an accessory dwelling unit, of what type, and at what size.
The questions your parcel answers before your budget does
- Is an ADU permitted on this lot at all? Eligibility varies by jurisdiction and often by zone district within a jurisdiction. Two houses on the same street can have different answers.
- Which types are allowed? Detached new construction, a basement conversion, a garage conversion and an attached unit are treated differently and are not interchangeable.
- How big can it be? Usually a function of lot size, lot coverage limits and a cap expressed as a proportion of the primary dwelling or a hard square-footage ceiling.
- Where can it sit? Setbacks from every property line, separation from the main house, and height limits that often bite hardest on detached units.
- What about parking and access? Some jurisdictions require an added space; some have removed the requirement; some tie it to proximity to transit.
- Is there an owner-occupancy condition? Where it exists, it constrains what you can do with both units and matters enormously if the plan is rental income.
Colorado ADU rules have moved considerably in recent years, and they are still moving. Anything you read that is more than a year or two old — including advice from a neighbour who built one — needs re-checking against your jurisdiction’s current adopted rules before it informs a decision.
The four types, and what each really costs you
Detached new build
A separate structure in the yard. The most flexible and usually the most expensive, because it is a small house: foundation, framing, roof, full mechanical, electrical and plumbing, and its own utility connections. It is also the type most constrained by lot coverage and setbacks.
Basement conversion
Often the cheapest path if the basement is already there — but it runs straight into the same three constraints as any basement finish: ceiling height measured to the lowest duct or beam, a compliant egress opening cut through the foundation wall, and moisture. It also needs a separate entrance, which usually means a new exterior door and a well or stair.
Garage conversion
Appealing because the shell exists. The work people underestimate is everything the shell was never designed for: an insulated floor assembly over an uninsulated slab, wall and roof insulation, heating and cooling, and the fact that many jurisdictions require the parking you just removed to be replaced somewhere on the lot.
Attached or multigenerational unit
An addition with its own entrance, kitchen and bath. Structurally it is a home addition and prices like one, with the added complication of fire separation and, in some cases, separate metering.
Utilities are the quiet cost
An ADU needs water, sewer, power and usually gas. Whether you extend from the existing house or run new services changes the number significantly, and it is frequently the largest single item nobody budgeted for. Sewer in particular can involve a long trench, a connection fee, and a tap size question that only shows up once someone actually asks the utility.
This is worth pricing early rather than late. It is also worth asking any builder to show you where the services will run on a site plan, not describe it verbally.
What to ask a builder before you hire one
- Have you built this type of ADU in this jurisdiction, and can you tell me what the department asked for?
- Who is doing the zoning verification, and does it happen before or after I pay for design?
- What is in the price, and specifically are utility connections, connection fees and the site plan inside it or outside it?
- Who handles the permit submittal and any resubmittals?
- What happens to the price if the zoning answer comes back smaller than we hoped?
Vague answers to the last two are the ones that cost money later.
How we approach it
AAA Home Improvements has been building on the Front Range for 25 years and works across all four ADU types — detached, basement, garage conversion and attached multigenerational units. Because we are design-build, the zoning check, the drawings, the engineering and the construction sit under one contract, which matters here more than on most work: an ADU that is redesigned twice because the first two versions were not permittable is an expensive way to learn your lot coverage limit.
We start with the address and the parcel, not with a rendering. If an ADU is not permittable on your lot, we would rather tell you on the first call than after you have paid for a design.
Want to know if your lot allows an ADU?
Give us the address. We will check what your parcel and jurisdiction actually permit before anyone draws anything.
Or call (720) 637-2060