They go by different names depending on the region: accessory apartment, in-law suite or in-law apartment, granny flat, second unit or secondary suite, and are also known as ohana units in Hawaii and casitas in the Southwest.

What Is an Accessory Dwelling Unit (ADU)?

You’ve probably heard terms like granny flat, in-law suite, casita, or guest house — they’re all versions of what’s officially called an Accessory Dwelling Unit (ADU).

An ADU is a fully independent living space located on the same lot as a single-family home. It has its own entrance, bathroom, and kitchen — and can be attached, detached, or a converted space (like a garage or attic). These units offer a flexible, smart solution for families and homeowners looking to add space or generate income.

In Dallas and surrounding suburbs like Frisco, McKinney, and Prosper, ADUs are gaining traction thanks to rising home prices, multigenerational living, and Airbnb income potential.

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The classic ADU or in-law suite is a self-contained space that offers both proximity and privacy. At the very least, it includes:

• A separate entrance

• A bedroom or sleeping area

• A full bathroom

• Others may also include a kitchenette or even a full kitchen, and a living room

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Types of ADUs:

• Attached ADU
  Built as an addition to your existing home, often with a separate side or rear entrance. Typically more affordable and easier to connect to utilities.

• Detached ADU
  A stand-alone unit in your backyard or side yard. Think of it like a guest house. Offers more privacy and is ideal for long-term rentals or Airbnb.

• Interior ADU
  A converted part of your existing home — such as a finished basement, garage, or attic — turned into a private living space with its own entrance.

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Common Uses in the Dallas Market:

• Rental income – Dallas homeowners are using ADUs to generate long-term rent or short-term Airbnb income, especially in high-demand areas like East Dallas, Oak Cliff, and Lake Highlands.

• Multigenerational living – With housing affordability being a challenge, ADUs offer a smart solution for keeping aging parents or adult children close while giving everyone privacy.

• Home office or business space – Many Dallas professionals are converting backyard structures into home offices, studios, or consulting spaces.

• Guest accommodations – A private, comfortable space for out-of-town family and friends, especially helpful during holidays or long visits.

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Important Local Considerations in Dallas:

1. Zoning & Permits

Not every Dallas neighborhood allows ADUs. You'll need to check with the City of Dallas zoning office or your local municipality if you're in a suburb. Areas like Old East Dallas, Bishop Arts, and Lakewood have different guidelines than, say, Frisco or Celina. Some HOAs may also restrict ADUs.

2. Rental Regulations

If you plan to rent it out (especially short-term), be aware of Dallas city rules around STR permits, inspections, and rental limits — which vary by neighborhood.

3. Purpose-Driven Design

Think about who will use the ADU. Older parents may need wider doorways and accessible showers. A workspace might need better insulation, built-in storage, or custom wiring.

4. Utilities

Make sure your existing gas, water, and electric systems can handle the extra load. In some Dallas suburbs, you may need separate meters or backflow prevention systems.

5. Financing

ADUs can range from $30K to over $150K depending on size and finish-out. In Texas, many homeowners use HELOCs, cash-out refinances, or builder financing options for these projects.

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The Bottom Line

Accessory Dwelling Units aren’t just a trend — they’re a smart, flexible way to create more space, serve family needs, or bring in passive income. If you’re thinking about adding an ADU in Dallas or the surrounding suburbs, I can help you weigh the pros, navigate city code, and even connect you with builders or architects who specialize in this type of build.

Let’s talk — I’ll help you figure out if an ADU makes sense for your property.