The Rise of the ADU: Increased popularity AND energy efficiency

Call it a Granny Flat, a Mother-in-Law Suite, a She Shed, a Man Cave, or whatever you want, an Accessory Dwelling Unit (ADU) has become the BIG THING in residential architecture today. ADUs have become a popular feature in homes from city neighborhoods to rural properties, and they make a lot of sense when you dig into the benefits. What we’re seeing, though, is that people not only want to build these additional living spaces on their property, but they want to build it in an efficient manner so that it works for them in the long term.

What is an ADU?

An ADU is an additional living space added to a property, containing all the essential functions of a normal house. They are a solution to the need for affordable housing, population density, and multi-generational living solutions. As the need and interest has grown, many local governments are passing new laws and regulations, allowing for more homeowners to build and rent ADUs. 

Why are ADUs so popular?

ADUs have risen in popularity in recent years for many reasons. Here are just a few of the top reasons why people are considering adding this accessory dwelling to their property:

Sharing Economy: As sites like Airbnb and VRBO become more popular for travelers or short-term renters, there is a need for smaller living spaces that are versatile. These are great income generators for existing homeowners.

Aging Population: As Baby Boomers become the largest aging population we’ve seen, many seniors are opting to live near their family but not fully with their family. ADUs make that possible in a simple way. 

Affordable Housing: Many municipalities have experienced higher housing costs, and the shortage often falls in the category of smaller apartments and affordable options. Adding more ADUs within existing neighborhoods allows for a simple solution for employees to live near where they work. 

Tiny Living: Most ADUs are smaller in nature (compared to the main house on a property) and are often less than 900 square feet. The recent popularity of tiny homes and minimalism has made this smaller living style more popular at large. 

Increased Property Values: An ADU increases the property value significantly. It’s an investment in a property that easily brings in a return, so it’s often a no-brainer for homeowners who are considering adding an ADU. 

Passive Income: Long-term renters are looking for an alternative to multi-family units such as apartment communities, especially during COVID-19, and a sense of their own space that is not communal. ADUs are a source of passive income to families.

Work From Home: With so many employees working from home (not to mention all the kiddos doing school from home, too), many Americans have turned their ADU into a home office space. An ADU gives you options! 

Don’t Just Build an ADU… Build an ADU That Works For You!

Many people get excited about the prospect of building out an ADU, but they don’t realize that by building an energy-efficient structure, they can actually make the building work FOR them even more than they thought. 

Waste Not Want Not

Suppose you’re using an ADU with renters, whether short-term or long-term folks, you don’t always get people who care about decreasing their energy load. Depending on the rental situation, you don’t necessarily charge renters for utilities. If you build an ADU that incorporates energy efficiency, one with passive house principles, and is built to last, you can help offset your investment. Instead of spending your income gained on utility bills and other regular maintenance projects, you can pocket that money as income or pay for the investment quicker! 

Thinking Outside of the Box

One of our friends, Bill Lucas, decided to build an ADU as a second level to his detached garage in a city neighborhood. While he built the structure with a lot of energy-efficient methods in the insulation, wall structure, window selection, and roof selection, he also considered how his ADU could help make his main house more efficient too. His main house is an older home, and the configuration/layout of the roof did not allow for the use of solar panels. However, the roof of the ADU DOES allow for solar panels. As such, he configured the electrical wiring so that the solar panels on the ADU can not only support the ADU itself, but also help cover the electrical load on the main house. Check out this tour and interview with Bill Lucas to get an insider view of his project.

Do the Right Thing

For many of us building energy-efficient Passive House buildings, we do it largely because it’s the right thing to do. Many homeowners building a brand new Passive House will add an ADU into their design and are intentional about making sure the envelope of every aspect of the build is done right from the start. Many homeowners retrofitting an existing space realize the shortcomings in the original structure and want to build the new ADU the right way from the start. 


Have you ever stayed at a really unique dwelling? Many travelers purposely seek out unique situations to stay in, like converted lighthouses, treehouses, and other extraordinary spaces. While your ADU rental might look like a normal house to the naked eye, it could be a great educational tool and a great marketing tool for future renters. Educate your renters on the features of the home, the story of the ADU, and some simple things that can be done to retrofit any space to be more energy efficient. 

Here are just a few of our favorite rentals that are not only leveraging their energy efficiency, but they are also educating in the process. 

  1. Award-winning Passive House on secluded mountainside
  2. Phoenix Haus-Powderhorn Mtn Resort 
  3. Earthship Off-Grid Rentals

If you’re considering adding an accessory dwelling unit (ADU) to your property, now is the time to dream. Go explore what others are doing to get ideas. See if there are ways you can leverage the structure to work for you, as well as your pocketbook. See if there are out-of-the-box ways to build the structure so that it works even smarter for you in the long run. Do your research now to make a smart plan for your ADU! 

Remember, we’re here to help. Together, let’s think through different options for construction, energy-efficient materials, and what people you need on your team. We enjoy dreaming with people about their next energy-efficient space, and we’d love to do it with you!

One thought on “The Rise of the ADU: Increased popularity AND energy efficiency”

  1. Thanks for this post!!

    I have an ADU on my property that is an upstairs Studio above our “two-car” garage (I quoted it, because there is one car bay, and the other bay is for workshop space – it’s pretty sweet!) We offer the ADU space as an AirBnB property (, as it is completely detached from the main house, has it’s own parking spot, entrance, and heat/water/etc. so it is perfect for a couple exploring all that is awesome about Southwestern Colorado.

    But…while it was built in only 2013, it has its issues – most notably heating and cooling, and windows. Now that we have 4.8kW of solar on the house, I have transitioned it’s propane heat completely to electric, by way of an 8-ft electric baseboard and a brand new electric fireplace – it’s pretty slick and tenants have had no problem keeping it warm and comfortable. There is no supplied cooling, and it does get hot up there. There is no attic, so I have no idea the quality of insulation in the roof, but the windows are pretty large, and likely pretty cheap. I wish I could upgrade the insulation without gutting the entire interior, but it seems like replacing the windows could be a big step. I also know that there is no way the building envelope is all that tight, since it was built as a garage first, and then the upper floor remodeled into what it is today.

    Anyway – every day is a new adventure! Thanks for the informative article!

Leave a Reply

Your email address will not be published. Required fields are marked *