Accessory Dwelling Units in Iowa

Accessory Dwelling Units (ADUs) are residential living units on the same lot as a single-family or primary dwelling. An ADU provides complete independent living facilities for one or more persons.

ADUs can take many forms – detached cottages, additions to the primary dwelling, remodeling of the upstairs or basement of a primary dwelling, an addition to a garage, or the conversion of a garage. The various forms of ADUs have many different names such as “carriage house,” “Granny flat,” or “In-law suite.”

AARP Iowa is working to expand access to this housing option by championing a statewide ADU law that requires all cities and counties in Iowa to allow homeowners to build an ADU on their property. ADUs can help increase housing choices across a range of neighborhoods – all through private action and without taxpayer subsidies.

AARP has worked closely with several municipalities across the state to make their communities ADU-friendly, but most Iowa communities still have restrictions that limit homeowners’ ability to build an ADU on their property. During the 2025 legislative session, AARP advocated for a statewide ADU bill that requires all cities and counties in Iowa to allow homeowners to build an ADU on their property. The bill, SF 592, passed in both chambers and is awaiting Governor Reynolds' signature.

Types of ADUs

Since ADUs can be created in many different shapes and styles, they can fit discreetly into all sorts of communities, including suburban subdivisions, row-house streets (either with or without back alleys), urban neighborhoods — and, of course, large lots in rural areas.

Detached ADU

A stand-alone home on the same lot as a larger, primary dwelling. Examples include backyard bungalows and converted outbuildings.

Attached ADU

Connects to an existing house, typically through the construction of an addition along the home’s side or rear. Such units can have a separate or shared entrance.

Garage ADU

Converts an attached or detached garage space into a residence. Other options involve adding a second-story ADU above/beside a garage or building a new structure for both people and cars.

Internal ADU

Created when a portion of an existing home is partitioned off and renovated to become a separate residence.

Lower-level ADU

Created through the conversion of a home’s existing basement, provided that height and safety conditions can be met.

ADU1

A backyard bungalow, a form of detached ADU.

ADU2

A converted outbuilding, a form of detached ADU.

ADU3

A unit attached to the upstairs of a house, a form of attached ADU.

ADU4

A second-story garage unit, a form of garage ADU.

ADU6

A basement unit with separate entrance, a form of lower-level ADU.

ADU7

The inside of an ADU.

ADU9

A converted outhouse, a form of detached ADU.

ADUs are flexible & adaptable – and can benefit Iowans in multiple ways. Across the U.S., ADUs are taking off as a popular new/old housing type. Some reasons for this emerging trend include:

• Income stream and property value.  ADUs can generate cash flow as short-term rentals and may increase the resale value of the property.  

• Match housing needs at any age.  ADUs can offer empty nesters and seniors the chance to “age in place” in the community they know and love, multi-generational families a way to live close by but not share a kitchen, and individuals and couples an entry-level housing choice. 

• Affordable housing.  ADUs help keep housing costs down for both owners and renters. They can generate rental income to help homeowners cover mortgage payments and may allow them to stay in their homes. Since ADUs are required to be small relative to primary dwellings, they are typically more affordable than other homes in the same neighborhood.   

• Versatility.  Needs change over time, and the uses of ADUs can (and often do) flex for different stages of life. Although they typically provide long-term housing, ADUs can also serve as home offices, caregiver or nanny housing, art studios, short-term rentals, and lodging for visiting friends or relatives. 

Empty Nesters and Retirees

Retirees can build an ADU and move into it, then rent out the main house for supplemental income or make it available to their adult children.

Individuals in Need of Care

People who need care or living assistance can reside in an ADU to be near family members, or they can use the ADU to house a family caregiver or a live-in aide. ADUs can be an affordable and more comforting alternative to an assisted-living facility or nursing home.

Families With Young Children

Families can use an ADU as housing for a nanny or au pair or even a grandparent or two, who can then help raise their grandkids and be assisted themselves as they age.

Home Buyers

Home buyers and renovators can use the rental income from an ADU to help pay their mortgage or finance home improvements, especially in expensive housing markets.

Commuters

Commuters can save money by having more choices of housing they can afford closer to their jobs.

Employers

Employers can find more employees who can afford to live in the community where they work.

Looking for more information on ADUs? Download our free guide!