ADUs BRING NEW OPTION TO REAL ESTATE IN COLORADO
Colorado, get ready. ADUs may soon be coming to a neighborhood near you. Maybe even your own neighborhood.
Beginning July 1, the accessory dwelling unit, or ADU, will be legal statewide in Colorado. Locally, Fort Collins got an early jump, implementing its own ADU policy as of February 15.
All of which leads to a few questions:
What is an ADU? It’s an independent living space that is part of an existing residential property, affectionately known as “granny flats.” A typical ADU might be an apartment built above a garage, a converted attic or garage, or a small outbuilding in the backyard.
Why is Colorado embracing ADUs? Housing supply is tight in Colorado, which helps to drive up both sale prices and rental rates. ADUs could make a dent in the state’s housing shortfall—currently estimated at 100,000 homes—and improve access to affordable housing.
What will ADUs mean for homeowners and real estate investors? In theory, ADUs make it possible for homeowners to add value to their property and could help defray an owner’s mortgage payment, thus improving the home’s affordability.
Similarly, investors—knowing they can add an ADU—could realize extra value from a rental house.
Will we see a wave of ADU construction? Not likely. Ask anyone who has undertaken a remodel project, the cost of construction is high and skilled labor is hard to come by. Also, lenders are still catching up on how to approach financing of ADU projects. Together, these factors should restrain the pace of ADU additions in the near future.
Municipalities can also impose restrictions beyond those set in the state law. For instance, Fort Collins mandates that ADUs cannot be used as short-term rentals (STRs). Depending on where you live, you are also subject to local limits on height, size, and setbacks—so be sure to check with local planning and zoning rules.
Call to discuss what the new ADU law could mean to you as a homeowner or investor. With property management services and mortgage lending expertise, The Group can help you understand your rental income potential or construction financing options.
WHO CAN USE THEIR HOME AS A SHORT-TERM RENTAL? FORT COLLINS HAS A MAP FOR THAT
Short-term rental (STR) services such as Airbnb and VRBO have helped homeowners across the country find new ways to pull in extra income from their properties—either by letting a lodger use a vacant bedroom, or renting out an entire unused house or apartment. And for some, the STR option has become a means to make their mortgage payment more affordable.
But be aware; where you live can determine if an STR—space that’s rented for 30 days or less—is permitted. And different communities have different rules to follow.
Locally, STR licenses are required in unincorporated Larimer County and Fort Collins. Fort Collins goes a step further, specifying that STRs are only permitted in single-family dwellings. Owners can rent both their primary residence or a non-primary residence (not owner-occupied). Recently, with the approval accessory dwelling units (ADUs) in Colorado, Fort Collins also bans the use of ADUs as short-term rental properties.
The city of Fort Collins recently released a map to define neighborhoods where STRs are allowed.
For additional information or to apply for a short term rental license, click HERE
Call to learn more about short-term rental policies in your neighborhood or community.
READY. SET. PLANT.
Home gardeners are eager to start planting. But when is the right time to plant your seeds? The answer is: NOW! You should plant seeds indoors 4 to 8 weeks before the last spring frost date, typically around May 11 or Mother’s Day in Northern Colorado. Our growing season lasts approximately 150 days.
To kill weed seeds and some damaging soil fungi, place your soil mix on sheet pans in an oven for 45 minutes at 250F. Fill seedling containers firmly but do not pack. Place seeds on the soil surface. Use a piece of window screen to sift soil over the seeds to the depth indicated on the seed packet. Keep soil moist.
Review the back of the seed packet for harvest time. For example, if a tomato takes 90 days to grow, you should start the seeds indoors by early April so you can pick them in July. You can also plant cool-season crops outside when the soil temperature is at least 40 degrees Fahrenheit, checking this at 8 a.m. at a depth of 4 inches.
Cool season crops include: Beets, broccoli, cabbage, carrots, cauliflower, peas, radishes, spinach, Swiss Chard, and turnips. They germinate best when soil temperature is between 40 and 80 degrees. Lettuce and onions germinate well when the temperature is between 35 and 75 degrees, and many people plant their peas on St. Patrick’s Day.
Warm season crops require a minimum soil temperature of at least 55 degrees. These include: Beans, cantaloupe, corn, cucumber, eggplant, peppers, squash, tomatoes, and watermelon. Note: Area farmers caution to resist temptation and wait until Memorial Day to plant your tomatoes, so cool nights don’t stunt their growth and delay fruiting.
CAN BACKYARD BIRDS HELP YOU BEAT THE HIGH COST OF EGGS?
Unless you’ve managed to cut eggs out of your diet—or you just returned from three years living off the grid—then you know the price of eggs at the grocery store has gone clucking crazy.
As if the cost of living wasn’t burden enough, right? Even Waffle House has imposed a 50-cent surcharge on each egg it serves.
While it’s unrealistic for the typical city resident homeowner to grow, process, and package most of what you eat every day, there is a way for Northern Colorado residents to beat egg-flation—if you’re willing to work at it.
Backyard chicken coops are legal in many communities in Northern Colorado, allowing urban residents with a sufficient sized lot to raise hens and collect their own eggs. But rules vary between towns. For instance, Fort Collins, Johnstown, Loveland, Timnath, Wellington, and Windsor all allow chickens, while Greeley does not. (Note: Your HOA rules can also prohibit backyard chickens).
In towns where chickens are legal, flock sizes are limited and licenses and inspections are generally required. For instance, NoCo Humane (formerly the Larimer County Humane Society) licenses coops in Fort Collins, unincorporated Larimer County, and other cooperating communities.
Of course, the pivotal question is how many eggs do you need to harvest on a weekly or monthly basis to make sure the backyard operation pays off? After all, there’s the upfront cost of building a coop and buying the chickens, the ongoing cost of chicken feed, not to mention the daily effort necessary to maintain a healthy flock.
Most experts say backyard farming doesn’t pay off if your primary goal is to get around egg prices at the store. But finding value in a backyard flock will likely depend on your family’s size and appetite for eggs, and whether you can sell some to friends and family. Chances are, someone in your neighborhood has already taken the leap, and may have insight to help you decide. NoCo Humane has issued 560 different licenses, mostly in Fort Collins, since 2008.
THE GROUP REAL ESTATE FORECAST
As it has for over two decades, The Group presented its annual real estate forecast and home expo to around 1,000 invited guests earlier this year. Company President Brandon Wells and Group Mortgage Branch Manager Jason Peifer guided attendees through the highlights of 2024 and shared their predictions for 2025.
We invite you, one of our 30,000 Insider readers, to view our presentation slides or listen to the video presentation to see for yourself why The Group Real Estate Forecast is the region’s premier and most anticipated forecasting event.
For more information click HERE
REAL ESTATE BY NUMBERS
- 5.46. Acreage in northeast Fort Collins that an investor wants to develop as a neighborhood shopping center. The site would include uses such as a restaurant, car wash, and coffee shop. The parcel is part of a larger 226-acre development on the north side of East Mulberry Street that is targeted for up to 1,600 new homes.
- $463 million. Potential investment required to maintain the presence of Weld County offices in downtown Greeley, where the county is outgrowing its existing facilities. Development of a downtown county campus would cost between $428 million and $463 million. By comparison, estimated costs for relocating county employees outside the central business district would be about $300 million.
- 2,277. Number of housing units that developers want to build as part of the 150-acre Centerra South development in east Loveland. It would be part of a larger 3,000-acre development that would unfold on both sides (north and south) of U.S. Highway 34.
- 400. Number of multi-family housing units proposed as part of a new mixed-use development planned near the southwest corner of Interstate 25 and Colorado Highway 392. The proposed “Interchange Development” would also include school, industrial, and commercial buildings.
- 9. Number of states that have seen their housing inventory surpass pre-pandemic levels as of December 2024. The list includes Arizona, Colorado, Florida, Idaho, Oklahoma, Tennessee, Texas, Utah, and Washington.
- 63 percent. Percentage of homeowners aged 65 and over who have fully paid off their homes, according to Census Bureau data. By contrast, less than 28 percent of working-age homeowners (under 65) have done so.
- $125 million. List price for the 52-acre Aspen retreat currently owned by billionaire Bill Koch. The Elk Mountain Lodge is a former event facility. It includes a 16,631-square-foot main building, with seven bedrooms and eight bathrooms, and seven other cabins totaling 8,646 square feet.
- $50 million. Estimated investment that JBS USA plans to make to improve and expand its Greeley beef packing plant. Plans call for a new distribution center. Construction is due to start later this year.
- $8.69 million. Price that Oregon-based investors paid for a 7-Eleven convenience store in Keenesburg, located near Interstate 76. The 4,732-square-foot store and accompanying fuel pump islands sit on a 2.4-acre lot.
- 90,000. Estimated number of build-to-rent single-family housing units that started under construction in 2023 in the United States, up from 81,000 in 2022, according to the National Association of Realtors. That number represents 10 percent of all new single-family housing starts in 2023.
- 6,682. The number of single-family homes listed for sale across Colorado as of January 1, 2025, up 23 percent over January of 2024, according to the Colorado Association of Realtors.
- 31.9 million. The number of “empty” bedrooms in homes in the United States in 2023, according to data from the U.S. Census Bureau, up from 31.3 million in 2022. In 1970, the Census Bureau estimated 4 million empty bedrooms. The estimate allows for the use of at least a bedroom as an office or storage room.
- 13.2 percent. Increase in the prices of framing lumber between February 7, 2024, and February 7, 2025, according to a report by the National Association of Homebuilders.
- 300,000. Approximate number of home sales in the United States with prices of $1 million or more during the 12 months ending in November of 2024, according to data from Realtor.com. That total is up from about 275,000 for the same period in 2023.
- 81 percent. Share of new homes built in the U.S. during 2023 that are part of a Homeowners Association (HOA), according to the latest U.S. Census data. In 2024, 9 percent of HOA members were paying more than $500 per month in HOA fees.