Orlando, Florida is offering homeowners more than $10,000 in incentives to build accessory dwelling units, or ADUs, to help expand affordable workforce housing.

The city’s new ADU incentive program offers rebates covering construction, permit and certain impact fees for homeowners who build small rental units and lease them at workforce-friendly rates. .

“We need a lot more affordable housing, and the market has always been producing three- and four-bedroom homes because that’s what we’ve always allowed. So we’re really playing catch up,” Orlando City Planning Manager Jason Burton told Homes.com.

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Orlando Launches ADU Incentive Program

Orlando approved the ADU Incentive Program in February as officials look for ways to address housing shortages tied to the region’s hospitality and tourism workforce, according to media reports.

The program includes rebates of up to $10,000 for ADU construction costs, along with rebates covering building permit fees and certain transportation, sewer and park impact fees.

Orlando Simplifies ADU Permitting

The city announced plans in February to develop a library of pre-approved ADU designs that officials hope will simplify permitting. 

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Orlando Housing Initiative Manager Ben Paquin told Benzinga on Tuesday that the city is soliciting pre-designed ADU plans for the program and now expects the online library to launch in the fall following a review process.

“We want to make it easier to build these types of units,” Paquin told WESH-TV in February. He said the process can be intimidating for many homeowners, but pre-approved plans could reduce design costs and streamline permitting.

ADU program rules limit units to 500 square feet and prohibit them from being built in front yards or dedicated easements.

ADUs Gain Attention As Housing Costs Rise

In Orlando, the average home listing price is about $374,302 while renters pay roughly $1,887 per month on average, according to Zillow.com.  

City officials view ADUs as a way to address housing shortages without requiring large-scale residential development projects, according to a February staff memorandum. 

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“ADUs contribute to neighborhood stability by increasing housing density without requiring new infrastructure or disrupting established neighborhood patterns (gentle density),” the memorandum states.

Lichtenstein said Orlando’s incentive program could encourage more ADU construction in the coming years. “If you visit other countries where there are population density issues, these are practical solutions that those countries deploy,” he said. “The demand is overwhelming for this.”

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