Are Backyard Apartments Helping Austin's Affordability?

Oct 10, 2016

Last November, the Austin City Council loosened regulations for what are called “accessory dwelling units.”  Those are buildings like backyard flats and garage apartments. Supporters of the change hoped it would bring more affordable housing to pricey neighborhoods. So, is it working?


When Lucas Schlager bought his East Austin bungalow last year, he pictured building a second, smaller dwelling in his spacious backyard. Maybe it would serve as a guesthouse, or maybe he’d rent it out during festivals. His property seemed perfect for it. It just met the minimum size required for such a project, which is 5,750 square feet.

“When I was looking at houses, when I bought this one, it’s 5,764, so just over the line, and I was like, 'Okay, if I’m going to get a house, I want the option to do this,'” Schlager said.

Schlager started researching what it would take to build the backyard flat – the technical term for it is an accessory dwelling unit, or ADU – and he was quickly dissuaded.

“I sort of had it in my head that the main challenge to think about would be, ‘What would the address be for that dwelling?’” he said. “But it turns out, there’s all kinds of just basic, building in Austin permitting nightmares.”

Last November, the Austin City Council voted to ease some regulations for ADUs. They can now be built closer to the main home, and parking requirements are looser, among other changes. The idea was that making ADUs easier to build could pepper smaller, more affordable units into increasingly expensive neighborhoods. But as Schlager found, the process isn’t cheap. After installing a separate water meter and utilities, he estimated the project would cost about $50,000. So, it’s on hold for now.

“If I found a bag with $50,000 cash on the street, I’d probably think a lot harder about building an ADU,” he said.

Architect Trinity White has worked with several clients looking to build accessory dwelling units in Austin.

“Most of the clients that I serve are putting in accessory dwelling units either to expand their family, to have kind of a multi-generational option on their property, usually to have in laws and a place for them to stay, or they’re using them as a rental,” White said.

But she said when you factor in plumbing, air conditioning and electricity, the start-up costs can be high.

Since council loosened the regulations last year, the city has received 211 applications for a permit to build ADUs, but not as many have actually been built. Several of those permits have yet to be approved.