StreamHome Construction Podcast

From Restrictions to Opportunities: Colorado Springs' New ADU Revolution Starts June 30th

• Alex Kosley • Episode 7

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What Should I Look For When Buying A Property With The Goal Of Adding An ADU?

Colorado Springs just witnessed a game-changing moment for property owners and investors as the city council passed a major ADU ordinance that will revolutionize accessory dwelling unit construction starting June 30, 2025. Licensed general contractor Alex Kosley breaks down exactly what property buyers should look for when planning to add an ADU, delivering this news just hours after the council vote.

The current landscape allows ADUs in specific zoning districts (R2, R4, and R5), with single-family zones limited to attached units only. Alex walks listeners through critical considerations including setback requirements, minimum space needs, parking considerations, and the golden opportunity of alleyway access. The real excitement comes from understanding how the upcoming changes will open ADU construction to approximately 193,000 additional properties across Colorado Springs—roughly 85% of the city's residential property mass.

This episode doesn't just cover the expanding opportunities but also addresses new limitations being implemented, such as height restrictions capping ADUs at 16 feet (25 feet if above a garage) and prohibitions on detached ADUs in wildfire risk zones. Alex provides thoughtful guidance on determining whether an ADU might serve as rental income, family housing, workspace, or multigenerational living quarters, emphasizing that "an ADU isn't just a building, it's a strategy" for financial freedom and community connection.

Ready to evaluate a property's ADU potential or start planning your project? Schedule a free consultation for personalized guidance from experts who understand both real estate and construction complexities in the Colorado Springs market.

To learn more about StreamHome Construction visit:
https://www.YourStreamHome.com
StreamHome Construction
719-644-6777

Speaker 1:

Welcome to the Stream Home Construction Podcast, where we take your project from conception to completion. Hosted by Licensed General Contractor Alex Kozley, we cover everything from accessory dwelling units to commercial construction in the greater Colorado Springs area. Whether you're dreaming of a new ADU, planning an office upgrade or tackling a major renovation project, we've got the expertise to guide you through it. Let's get building.

Speaker 2:

Welcome back everyone, Tony Hill's co-host slash producer back in the studio with licensed general contractor Alex Cozley. Alex, how's it going?

Speaker 3:

I'm doing wonderful today, tony, how are you doing?

Speaker 2:

That's great to hear, Alex, Great to hear. Everyone wants to know what should I look for when buying a property with the goal of adding an ADU?

Speaker 3:

Well, tony, that's an awesome question and, honestly, the timing couldn't be better. Less than two hours ago, just this morning, city council here in Colorado Springs just voted and passed a major ADU code change ordinance. We're really excited about that and it's going to be a game changer for a lot of homeowners and real estate investors in the area. I'll also dive in some details. I do want to break this into two parts, because the code was just passed today. It won't go to effect June 30th. We want to try to be clear between what to look for now versus how things are going to change come June 30th 2025. So, basically, right now, under current rules in Colorado Springs, edus or accessory dwelling units are allowed in a few specific zoning districts, most notably R2, r4, and R5, which are basically your two-family and multifamily zoning districts.

Speaker 3:

Within these districts, right now you can build either an attached or a detached ADU. That gives you some nice flexibility Now. Currently you can also build an ADU in R1 in single-family zone districts, but it can only be attached. However, that's going to change with the new code that was just passed today, starting in February. We'll talk about that in a minute. Some other requirements that you're looking for on your lots the R2, r4, r5 lots also have to make sure that there's room for the ADU within the setback requirements. So, if anyone's not familiar, setbacks are basically an area that extends from your property line inwards and, just depending on the zone district and if it's a front, a side or a rear property line a setback is basically an area that you're not allowed to construct a building within.

Speaker 3:

So in the R2, R4, R5 zone districts the correct setbacks for ADUs in the side and rear yards are five. You can put it pretty close back into the corner, but that's just something to take into consideration. When you're looking for a property, you make sure there's enough room to build it and it's not inside of those setbacks.

Speaker 3:

So yeah, unless you're on a corner lot, you have some larger setbacks and a smaller buildable footprint. Basically, the smallest footprint size that we can work with is about 15 by 20 feet. You know 300 foot footprint, just so that we can mentally build an apartment and we can work with, is about 15 by 20 feet. You know 300 foot footprint just so that we can mentally build an apartment. I mean we can build a couple stories in there, but that's at least a 15 by 20 foot rectangle that's not encroaching into the property. Setbacks will be key. We also want to make sure there's a clear space not obstructed by utilities, trees or odd slopes. Although we can handle all those things if needed, it's not the ideal or lowest price options. Let's not forget about parking either. City Council in the newest code change was considering removing parking requirements for ADUs. However, due to tremendous pushback from people in the city, they have opted to add a parking requirement back into the new ADU code change. So they were considering taking it away, but it's going to remain. So you do also need a space for a parking spot. If you don't have it, it's possible to get a variance from city planning, which is something that we've successfully done before, but we always try to incorporate a parking space into our project. Another thing I would add in looking for a property that's ADU friendly, I think the dream scenario is having an alleyway in the back of the property. It just makes it really easy to almost like create two separate properties. You know they had to. Whoever lives in the ADU can pull in through the alley. You can separate the front and the rear yard with a fence through the middle and then it can almost function like two totally separate properties, just like your house and your neighbor's house, essentially at that point. So definitely a plus, but not required to have an alleyway. So that generally covers the R2 kind of requirements, what you're generally looking for for a property that's ADU friendly.

Speaker 3:

Now let's talk about kind of the exciting news from today, and that is that this new ordinance June 30th will allow detached ADUs also in single-family zone districts. This is a big deal. This is most of just residential properties in Colorado Springs are single-family. Actually about I think between 80% and 85% of all residential properties are single-family, whereas detached was only allowed in the multi family. Now going to single family is going to increase about seven times the number of properties that we're going to be allowed to build ADUs on in Colorado Springs starting June 30th. So that's super exciting. It's about 85% of the total land mass of Colorado Springs is sold for single family residential, so major, majorly opening the market to us.

Speaker 3:

We had a totally change of game. I did a little bit of research. There's actually about 193,000 properties in Colorado Springs on single family that today you can't build a detached ADU on, but starting June 30th you will. So this is a major, major change. It's going to increase the demand for ADUs financially and we're definitely planning to see a major influx, which is one reason we've been pouring our energy into developing a set of streamlined ADU models. We want to be ready to meet this increased demand as soon as the new code is in effect. These models are all designed to be built faster, more affordably than full custom projects, while still offering great layouts, modern design, all the essentials. But of course, if you have a specific vision or a unique lot, you can always build custom design building ADUs that fits your goals and budget.

Speaker 3:

I do want to mention, in conjunction with the new ADU code, it's not all loosening the regulations.

Speaker 3:

There's a couple areas that it has to tighten the regulations, so something to watch out for when you're looking for an ADU-friendly property.

Speaker 3:

One of those is that you can no longer build detached ADUs once the new code goes into effect in the WUI fire risk zone in Colorado Springs, and that was something that we built in the WUI before, but they're not going to allow that moving forward starting June 30th.

Speaker 3:

So that's one change that's kind of restricted how ADUs can be built, and another change that's restricting use compared to the existing code is that building heights are now going to be limited for ADUs to 16 feet, and now, unless it's built above a detached garage, then the height limit is going to be 25 feet, where the previous height limit was 25 feet or even 28 feet, depending on the pitch of your roof. The previous height limit was 25 feet or even 28 feet, depending on the pitch of your roof. Now they're really basically eliminating two-story ADUs, which has been almost half of our projects. Wouldn't be feasible under these new codes. You can call us directly to help in your property search. If you already have a realtor, though, they can call us and we can work with them to help evaluate whether the property is a good fit for you.

Speaker 3:

On the other hand, if you aren't already, working with a realtor and want someone who really understands the ADU landscape. I'm personally a licensed realtor and really specializing in ADU-friendly properties. I'd be honored to help anyone find the right property that fits their investment or family goals as well. Also, you can always schedule a free consultation on our website. They'll walk you through the zoning, setbacks, parking, everything else you need to know to know what's possible, what's feasible on any property. I'll leave you with a few questions to think about for anyone who's considering building an ADU.

Speaker 3:

Just some things to jot down and be thinking about to get the juices flowing. For one do you want the ADU to be a rental property, family guest house or something like a work-from-home office or multi-generational setup? Are you more interested in speed and affordability, or are you hoping to design something truly unique? Importantly, most importantly, what's your long-term vision for the property? Are you thinking about wealth building, flexibility, aging in place, helping family or just maximizing your properties? Because, at the end of the day, an ADU isn't just a building, it's a strategy and, if done right, it can really open up doors for financial freedom, financial support and even community connection. So, again, when looking to buy a property and judging whether or not it's a good fit for a future ADU. We recommend you hit us up at yourstreamhomecom. Give us a call at text 719-644-6777. We'll help you make your ADU dream a reality.

Speaker 2:

Okay, okay, awesome. Just out of curiosity, how can a buyer estimate the cost of utility upgrades before purchasing a property?

Speaker 3:

The best way again is to speak to an expert in the field so you know they can call us, we can give them a full rundown. Before we start any project, we provide our clients with a ballpark estimate that really itemizes every single cost that they're going to face. You know, on building an ADU, we want people to have a good idea of what all the costs are going to be before they sign up and start the design or pre-construction phase on their project. So again, best recommendation talk to a contractor who can do that work.

Speaker 2:

Well as always, Alex, that's some informative and helpful information you gave us today. Thanks again, and we'll catch you in the next episode. Have a fantastic rest of your day, you too. See you.

Speaker 1:

Thanks, Tony rest of your day. You too, see you. Thanks, tony. That's a wrap for this episode of the Stream Home Construction Podcast. Ready to bring your vision to life? Snag a free on-site consultation by visiting our website at wwwyourstreamhomecom, or call or text us at 719-644-6777. Until next time, let's keep building your residential and commercial dream in the greater Colorado Springs area.