By Standard Building Company. Published October 22, 2026.
An accessory dwelling unit is a second, smaller home on the same lot as a primary house: a garage apartment, a backyard cottage, a basement unit with its own entrance, or a converted garage. Northern Colorado homeowners build them for aging parents, adult kids, rental income, or a home office that can become a rental later. The rules used to be a patchwork; since Colorado's 2024 ADU law took effect, every larger Front Range city has to allow them in single-family zones. The details are still local, and the details decide whether your lot can take one. This guide covers what to check and what to expect.
What the state law did
House Bill 24-1152 requires municipalities of 1,000 or more people inside a metropolitan planning organization area, which covers Loveland, Fort Collins, and the other larger Larimer and Weld County cities, to allow at least one ADU on any lot where a single-family home is allowed. It also limits how restrictive cities can be. They cannot automatically require new off-street parking for an ADU; one space can be required only in narrow cases, such as when a driveway or garage space already exists. They cannot require the owner to live in the main house long term, though they can require owner occupancy at the time the ADU is permitted. And they cannot impose architectural style, material, or landscaping standards on the ADU that are stricter than the standards for the main house. Cities may still exempt some parcels, such as lots in a floodplain or without water and sewer service.
What the law does not do is write the rules for you. Size limits, setbacks, height, utility connections, and short-term rental use are still set by each city, and those are what you need to check.
What to check for your lot
- Zoning and lot size. Confirm your lot is in a zone where a single-family home is allowed and find the city's ADU size cap, usually a maximum square footage or a percentage of the primary house.
- Setbacks and height. A detached ADU has its own setbacks from the side and rear property lines, often smaller than the main house, and a height limit that matters for a garage apartment.
- Lot coverage. The main house, the garage, and the ADU together cannot exceed the zone's maximum coverage. On a small infill lot this is often the limiting factor.
- Utilities. Whether the ADU can share the main house's water, sewer, electric, and gas service or needs its own taps and meters. This is frequently the largest single cost variable in an ADU.
- Access. A path to the entrance and, in some cities, emergency vehicle access considerations for a backyard unit.
- HOA covenants. State law limits what HOAs can prohibit, but check the covenants and talk to the board early.
- Short-term rental rules. Most cities regulate or license short-term rentals separately, so an ADU built to rent on a nightly basis needs a second set of answers.
City by city
Loveland. The City of Loveland allows ADUs in residential zones under its development code, with size, setback, and height standards set by the city and permits issued by the Loveland building department. Loveland Water and Power handles electric and water, so a separate meter or an upgraded service goes through the city utility.
Fort Collins. Fort Collins updated its land use code to allow ADUs broadly after the state law, with size limits tied to the primary dwelling and standards for detached units. Fort Collins Utilities provides electric, water, and wastewater inside city limits. Properties in historic districts or designated landmarks may need design review for a detached unit.
Berthoud, Windsor, Johnstown, Timnath, Wellington. Each has its own code with ADU provisions, and the smaller towns were not all covered by the state mandate in the same way, so the allowances differ. Several allow ADUs by right in some residential zones and by special review in others.
Unincorporated Larimer County. The county land use code allows accessory dwelling units on lots that meet minimum size and, in many cases, sewer or septic capacity requirements. A rural ADU on a septic system needs the system sized for the added bedrooms, which the county health department reviews.
Codes change, and this is a summary, not legal advice. We check the current code for your address before any design starts.
Types of ADUs and what they cost
The least expensive ADU is usually an interior conversion: a basement or a portion of the house with its own entrance, kitchen, and bath. The structure already exists; the work is plumbing, electrical, egress, fire separation, and finish. These generally run $60,000 to $140,000 on the Front Range.
A garage conversion is next: insulation, a floor system, heating and cooling, plumbing, egress, and a change of use permit. Generally $80,000 to $160,000, more if the garage slab has to come up for drains.
A garage apartment, built above a new or existing garage, adds a second-story structure, stairs, and a full set of systems. Generally $180,000 to $300,000.
A detached backyard cottage is a small custom home: foundation, framing, roof, envelope, systems, and finish, plus utility trenching. Generally $200,000 to $350,000 and up depending on size, utility distance, and finish. Utility taps and meters alone can be $10,000 to $40,000 depending on the city and what the lot has.
These are 2026 planning ranges for Loveland, Fort Collins, and the surrounding Front Range communities. Mountain-town ADUs cost considerably more.
The process
Design-build is the right model for an ADU because the zoning check, the drawings, the utility plan, and the construction are all interdependent. We start with the lot: zoning, setbacks, coverage, and utilities. Then concept design with a cost range. Then the permit set with engineering, and a fixed price. Permitting for an ADU takes four to ten weeks in most Larimer County jurisdictions. Construction runs three to five months for a conversion and five to nine months for a detached unit.
The next step
If you are thinking about an ADU on a lot in Loveland, Fort Collins, Berthoud, Windsor, or the county, the first step is a lot check, which we do before any design fee. Call (970) 430-5884 or send the contact form with your address and what you have in mind.
Related services
- ADUs & GaragesAccessory dwelling units, garage apartments, detached garages, shops, and pole barns, designed and permitted.
- Custom HomesNew homes on your lot in Northern Colorado and the mountain towns, from site plan to keys.
- Design & PermittingConcept drawings, permit sets, engineering, and the submittal itself, done by the firm that will build it.
Standard Building Company works on homes only. For commercial, industrial, or public projects, contact Standard Development Company.