The city of New York has launched a package of resources aimed at helping homeowners convert unused space into income-producing or family housing. At the heart of the effort is the Plus One ADU Program, which combines grants and forgivable loans to offer as much as $395,000 to qualifying owner-occupants. The program sits alongside an online toolkit created to simplify what has traditionally been a confusing maze of zoning, permits and design choices.
The initiative is intended to expand housing supply while letting neighborhoods retain their existing character.
Interest in the program was intense during an early pilot: more than 1,300 submissions arrived within two weeks before that initial application window closed. The relaunched effort is open to one-to-four-family homeowners who live on the property, are current on mortgages and taxes, and have no open building-code violations or properties in FEMA flood zones. Funds are intended to cover construction, design, permitting and technical assistance, not just raw building costs.
Table of Contents:
What the city is offering and who can apply
Financial support is structured as a mix of direct grants and forgivable loans, administered in partnership with community organizations and backed by both city funds and resources from New York State Homes and Community Renewal. Eligible owners can use the money for a variety of projects: converting basements and attics, adding a backyard cottage, or creating a separate unit attached to the main house. Administration is handled with intermediary partners such as the Restored Homes Housing Development Fund Corporation, which helps guide applicants through compliance and construction steps.
Tools to speed approvals and lower costs
The city has rolled out a centralized platform called ADU for You that functions as a step-by-step guidebook. Homeowners can check lot eligibility, estimate project budgets and follow a recommended pathway for permitting. The platform also connects applicants with professionals who helped design the pre-approved options, shortening the usual back-and-forth with building officials and potentially reducing time and expense.
Pre-approved plan library
A key feature is the pre-approved plan library: a curated set of designs that have already undergone an initial Department of Buildings code review. The library includes 11 designs ranging from roughly 280 square feet to about 785 square feet, including compact studios and two-bedroom backyard cottages. Picking a pre-reviewed option can streamline the permit process because many compliance questions have been resolved in advance.
Permitting and technical assistance
Alongside plans and funding, the city offers guidance on zoning allowances introduced under recent rezonings, sometimes called the City of Yes for Housing Opportunity. Those changes broaden where accessory units can be built in historically low-density neighborhoods. The combined approach—money, plans and a clear permitting path—aims to make it easier for homeowners to add a unit for a relative, a long-term tenant or supplemental rental income.
How this fits into broader ADU trends across the United States
New York’s move is part of a nationwide shift toward enabling ADUs—a shorthand for accessory dwelling unit. State and local governments have been revising rules and offering incentives to increase housing supply without large-scale redevelopment. Examples include Fairfax County, Virginia, which eased ADU rules in its 2026 zoning update, and Seattle, which relaxed regulations in 2019 to allow two ADUs per lot and remove some owner-occupancy and parking requirements, enabling more cost-effective density.
State-by-state approaches
Several states now require or encourage ADUs: California mandates ADUs in most residential zones with a 60-day approval window and limited impact fees for units under 750 square feet. Oregon requires at least one ADU on most urban single-family lots and Portland often allows multiple units per lot. Washington limits parking and fees and broadly permits attached and detached ADUs. Maine sets a minimum around 190 square feet and allows multiple units. Notably, Maryland’s Small Houses Act (2026) requires covered jurisdictions and Baltimore City to legalize ADUs on single-family lots by late 2026. Colorado, Massachusetts and Connecticut have also taken steps to loosen rules, though local specifics vary.
Short-term rentals, landlords and practical considerations
While many ADU initiatives assume long-term tenancy or family use, short-term rental rules differ widely. In some places, new legislation is changing the landscape: for example, a Washington, D.C. proposal called the Short-Term Rental Regulation Amendment Act of 2026 would allow tenants in certain situations to host short-term guests, a change that could affect how landlords and renters think about leasing and profit-sharing. However, allowing frequent short-term use raises legal and management concerns, and in many jurisdictions restrictions still limit such activity.
For prospective landlords or homeowners considering ADUs, the New York program presents a rare combination of substantial financial aid, technical support and pre-vetted designs. It can be an entry point into property investment, a way to age in place, or a path to modest income. But applicants should carefully review eligibility rules, local zoning details and how financing terms like forgivable loans are structured before committing.
