‘Granny flats’ design gets head start in Rochester ADU push – Rochester Post Bulletin

ROCHESTER — Rochester is preparing to open the door wider for the creation of accessory-dwelling units, sometimes called “granny flats,” but one builder decided not to wait.

Bigelow Homes recently unveiled an ADU built over a garage of a new single-family home in its Harvestview subdivision in Northwest Rochester.

“This has been in the works for years,” said Mike Paradise, the company’s president.

He said the concept was part of the neighborhood plan when it emerged approximately 15 years ago, but construction of the smaller units was delayed as new home construction slowed.

The new home at 5303 56th St. NW was officially approved as a duplex, with two distinct living spaces, but it’s being marketed as a single-family home with an attached ADU.

The main home offers nearly 2,400 square feet on two levels with three bedrooms and two bathrooms, while a 600-square-foot studio apartment is built above the garage.

Each unit has a separate exterior door, as well as its own locked entrance in the shared garage.

Paradise said the added unit provides the potential for rental income with an estimated $900 to $1,000 monthly lease, or a place for a family member or a caregiver to live.

Dean Mack, the Edina Realty real estate agent marketing the property, agreed the potential uses are numerous.

“I think there will be buyers looking at the use of those units in many different ways,” he said.

With the first home and ADU built, Mack said three investors are in negotiations for purchase of the single property with the intent to rent both portions of the home, which is listed for sale at $464,900.

While not officially designated as an ADU under city code, builders throughout Rochester will see more flexibility for creating accessory housing next year as the new unified building code is adopted in January.

The code change allows a secondary unit on all residential lots, with some limits to size of the secondary unity and a requirement that the property owner live in one of the units in areas intended specifically for single-family homes.

The new development code will also end the use of special districts, which gave Bigelow Homes flexibility in the Harvestview subdivision, but Paradise said he doesn’t anticipate it will rule out moving forward with more ADUs.

The Harvestview home is slated to be rezoned for multifamily housing, but other nearby lots are expected to require the property owner to live on site if an ADU is added.

Paradise said he thinks there will be challenges to the owner-occupancy requirement, but for now the homes will be built and sold with the requirements in mind.

Mack also pointed to flexibility as rules change, pointing out that some potential buyers have already inquired about options with the secondary unit on the ground floor to provide improved accessibility.

“We can design anything that fits on that lot,” he said, adding that some custom options are being discussed.

Paradise said any of the neighbor’s housing plans could be adopted to include an ADU.

At this point, Mack said the biggest challenge for new homeowners could be financing the homes, which are likely to be seen as rental units in loan applications, making it more difficult to purchase with low down payments.

“As these ADUs become more popular, I believe they will have some special financing available,” he said.

The city of Rochester is already starting to offer some assistance to people wanting to build ADUs as affordable options.

The Rochester City Council approved a program last month to provide up to $20,000 in reimbursement payments for city-related fees and costs related to construction of ADUs for new or existing homes.

The city support requires the ADU be occupied by residents earning 80% of the area median income or less — approximately $62,480 a year for an individual or $89,200 for a family of four for the city program.

If the ADU is built as a rental unit, the monthly rent cannot exceed federally defined fair-market rents, which is currently $732 a month for a studio apartment or $865 for a one-bedroom unit in Rochester.

Taryn Edens, Rochester’s manager of housing and neighborhood services, said the program, which is slated to begin in 2023, has seen interest, but mainly from property owners who want to add a housing option to their existing home, either as a rental property or for use by family members.

“We haven’t heard much for new construction, so it will be interesting to see if it takes off,” she said.

Paradise said future Harvestview units likely won’t qualify for the city support. With construction costs harder to predict recently, he anticipated the cost of adding ADUs to new homes will increase a bit.

He estimated the first unit cost approximately $80,000 to add to the existing home plan, but future units could increase construction costs of a home by $100,000, depending on size and other factors.

Still, he said he anticipates the rental option to be an ideal fit to house young professionals or provide options for multi-generational families with members needing private spaces.

“I don’t think this will solve the housing crisis, but it will help,” Paradise said.