Denver is highly ADU-friendly, allowing detached and attached units in most residential zones with streamlined approval. The city's emphasis on infill development and housing affordability makes it one of the nation's better ADU markets.
Zoning & Size Requirements [1][2]
| Allowed Zones | All residential zones |
| Max Size (Detached) | 864 sq ft |
| Max Size (Attached) | 864 sq ft |
| Max Size (JADU) | 800 sq ft |
| Max Height | 24 ft maximum |
| Max Units | 1 detached + 1 attached per lot |
Setback Requirements [1][2]
| Rear Setback | Must be within rear 35% of lot; 5 ft minimum rear setback |
| Side Setback | 3 feet |
| Front Setback | 15 feet |
| Parking Required | 1 space per unit |
| Owner Occupancy | Required in single-unit zones (owner must live in primary or ADU) |
| Min Lot Size | 3,500 sq ft |
Permit Process & Fees [3]
| Approval Process | Ministerial approval (by-right) |
| Review Timeline | 30-45 days |
| Permit Fees | $1,600-$2,700 |
| Impact Fees | Minimal |
| Plan Check | 1-2 weeks |
| Pre-Approved Plans | Extensive library available |
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Construction Costs [4][5]
| Average Build Cost | $140,000-$280,000 |
| Cost per Sq Ft | $130-$260 |
| Garage Conversion | $70,000-$160,000 |
| Prefab ADU (Installed) | $100,000-$230,000 |
Finance Your ADU Project
Most ADU projects are funded through HELOCs, construction loans, or cash-out refinancing. Compare rates from top lenders.
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Rental Income Potential [6][7]
| Avg Rent (1 Bedroom) | $1,400-$1,900/mo |
| Avg Rent (2 Bedroom) | $1,800-$2,500/mo |
| Short-Term Rental | Yes, with STR license |
| Est. Annual ROI | 7-9% annual return |
Explore Prefab ADU Options
Prefab ADUs can save 20-40% vs. traditional construction and cut build time in half.
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Recent Law Changes
What's Changed Recently
- Denver ADU ordinance expanded (2026): ADUs now allowed on all residential lots citywide
- Boulder reduced ADU setback requirements to 3 ft for rear structures
- Colorado Springs streamlined ADU permitting: 45-day review guaranteed (2026)
- State HB 24-1152 effects: More municipalities adopting ADU-friendly policies
Tips for Building an ADU in Denver
- Denver's by-right approval means fastest permitting timeline
- Tech and service industry growth ensures strong rental demand
- Short-term rental market strong; explore vacation rental opportunities
- Pre-approved plans available; maximize timeline efficiency
Sources & References
All data on this page is sourced from official government records and verified market data. View our full methodology.
- Accessory Dwelling Units (ADUs) in Denver Planning Department — Accessed 2026-02-24
- Citywide ADU Zoning Text Amendment Municipal Code — Accessed 2026-02-24
- ADU Permits | Denver CPD Planning Department — Accessed 2026-02-24
- HomeAdvisor — ADU Construction Cost Data Market Data — Accessed 2026-02-24
- Angi — Local ADU Contractor Costs Market Data — Accessed 2026-02-24
- Zillow Rental Manager — Market Rent Data Market Data — Accessed 2026-02-24
- HUD Fair Market Rents Government Data — Accessed 2026-02-24
- Denver ADU Interactive Map Planning Department — Accessed 2026-02-24
- Colorado ADU Legislation (HB 24-1152) Government Data — Accessed 2026-02-24
Frequently Asked Questions
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