A new report says the Accessory Dwelling Unit (ADU) housing market reached $21.45 billion in 2026, with Washington emerging as a national leader in ADU policy and permit growth.
The article points to Washington’s HB 1337, effective July 2025, as one of the most permissive ADU frameworks in the country. The law requires cities and counties to allow at least two ADUs per residential lot and removes owner-occupancy requirements.
The report says Washington accounts for about 6% of national ADU permits since 2018, behind California, Florida, and Texas by raw volume, but it argues Washington’s policy structure may be especially important because it limits local barriers such as restrictive height, setback, or street-improvement requirements.
The article also notes that Seattle-area detached ADUs can cost roughly $250,000 to $400,000 all in, while attached ADUs, basement conversions, and garage conversions may run closer to $150,000 to $300,000 depending on conditions.
Why it matters: ADUs are not conventional multi-family, but they are part of the housing supply story. In Washington, the state is using preemption to push local jurisdictions toward more housing flexibility.
For apartment owners, ADUs create a modest shadow supply in some neighborhoods, but they also reflect the larger policy direction: more density, more infill, and fewer local veto points.