ADU Potential: Adding an Accessory Dwelling Unit at 2924 Zenobia

What is an ADU? An accessory dwelling unit is a secondary, self-contained residence on the same lot as a primary single-family home. In Denver, ADUs take three common forms: detached (a standalone structure, often near the alley), attached (an addition onto the primary home), and internal (a conversion of existing interior space, typically a basement or upper level). Each type has its own cost and permitting profile.

Denver's citywide ADU expansion. Over the last several years Denver has progressively expanded ADU eligibility across residential zones, including many West Highlands parcels that previously required a rezoning. The practical effect is that a larger share of single-family lots can now build a detached ADU as of right, subject to the specific zone district, setbacks, and form standards that apply to that parcel. This is general information, not legal advice, and the rules continue to evolve.

Typical size and height. In U-SU and U-TU zone districts, which cover much of West Highlands, detached ADUs are commonly allowed up to roughly 1.5 stories and 650 to 1,000 square feet depending on lot size, coverage limits, and whether the ADU is in the rear setback. Attached ADUs and basement conversions follow a different set of form standards and often allow slightly more flexibility because no new footprint is added. Confirm the exact dimensional limits for this parcel on the Denver Zoning Map.

Construction costs. Denver ADU construction costs have been volatile. As a rough orientation, detached ADUs are currently coming in around $350,000 to $550,000 total including design, permitting, utilities, and finishes, with attached additions and basement conversions often landing 20 to 40 percent below that. These are estimates only. Numbers shift with lumber prices, labor availability, and the quality of the build. Get multiple contractor bids specific to the proposed design before committing to financing.

Financing options. Most ADU projects in Denver are financed with one of four instruments: a cash-out refinance of the primary mortgage, a home equity line of credit (HELOC), a renovation loan product such as FHA 203k or Fannie Mae HomeStyle, or a dedicated construction loan that converts to a permanent mortgage at completion. Each has trade-offs between rate, timing, and how much projected rental income the lender will count toward the qualifying ratio. A mortgage broker with Denver ADU experience is worth the intro call before design work begins.

Rental and appraisal impact. Permitted, legal ADUs generally increase appraised value and unlock a second income stream. In West Highlands, standalone long-term rentals in that 600-to-900 sqft range typically rent between roughly $1,500 and $2,200 per month, depending on finishes and yard access. Rental figures are estimates only and depend on market conditions at lease-up. Appraisers are more likely to credit an ADU at full value when it is fully permitted, separately metered where possible, and has its own legal address.

Why 2924 Zenobia is well-suited. Four things stand out on this lot: (1) the 8,310 sqft size leaves room to keep the existing bungalow intact and still meet rear-yard setbacks for a detached ADU; (2) the existing detached studio already has utilities and sits where an ADU would typically go, which can shorten timeline if converted rather than demolished; (3) alley access simplifies construction logistics and parking; and (4) the primary home is move-in ready, so an owner can live in it or rent it out while permits and construction are pursued.

Next steps. The first three calls we recommend to serious ADU buyers: a designer or architect who has built ADUs in Denver recently, a licensed general contractor for an early cost check, and a lender familiar with renovation or construction loan products. Before those calls it is worth pulling the parcel's specific zoning designation and ordering a plat so everyone is working from the same constraints.