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DADU? What’s That?

April 1, 2016

Coming soon to a backyard near you: a cottage…if certain changes to Seattle’s land use code go through. Proposed as a means to address the city’s increasingly unaffordable housing costs, the rules governing backyard cottages are being reexamined, in an effort to bring to market an increase in the number of this humble housing type.

 

In the early ‘90s, state law was revised, obligating municipalities with over 20,000 residents to allow attached accessory dwelling units (ADUs, or what most people know as a mother-in-law apartment). Since 2010, Seattle has allowed property owners in single-family zones to build a second, separate residential structure on their property, a detached accessory unit or DADU, or in the more heartwarming parlance, backyard cottage. The target in large part for both of these modifications was affordability, while at the same time giving homeowners the opportunity for bolstering their long-term financial security, a means for getting something out of home equity without having to sell their home. The sticking point ever since has been one of implementation: remarkably few people in Seattle have pursued establishing a backyard cottage.

 

The overheated housing market of recent years has brought the issue of affordability into sharp relief, renewing interest in the potential of DADUs to bring housing costs down and raising the question of why so little activity has occurred in the arena. Those familiar with the process began to point to a litany of rules that have likely been suppressing the backyard cottage appetite. Led in part by councilmember Mike O’Brien, the city has been looking into the specific impacts of certain regulations, while taking the temperature of the citizenry in public meetings and written testimony, testing our tolerance for change.

 

One of the chief impediments identified has been reticence on the part of banks to loan for DADU projects. The culprit it would seem is the draconian penalty for violating city ordinance which, rather than just levying a simple fine, could result in the wholesale demolition of the structure. Considering that the DADU is likely the collateral for a construction loan, it’s easy to imagine that a bank might hesitate to take the risk. One of the avenues that could lead to this extreme scenario is the requirement that the property owner live on site (in either the primary or accessory unit), with no more than six months spent living elsewhere in any 12-month period. Seems harmless enough, and those arguing for keeping the ownership rule intact feel that without this rule, the DADU market will become a bonanza for developers, rather than a route to affordability for potential renters, and lead to instability and excessive transience in the neighborhoods.

 

Others point out that the six-month limit becomes a serious problem for anyone who receives a job assignment that could take them out of town for more than a year. Moreover, if the homeowner decides to sell, the buyer must either abide by the same rule or tear the DADU down. Lending institutions are not fond of this level of uncertainty. That combined with the apparent majority of respondents coming down on the side of change would indicate a likely loosening of this regulation.

 

~Jeff Floor,

Leschi CC Board Member and Co-Chair of the Land Use Review Committee

 

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