The City of New York is getting behind the tiny-house movement big time.

In an effort to create more affordable housing, a few lucky borough homeowners will be granted hundreds of thousands of dollars to construct accessory dwelling units (ADU) on their properties.

Last Tuesday, the New York City Department of Housing Preservation and Development (HPD) announced the launch of its new “Plus One ADU” pilot program, which will fund the creation of additional living space for growing and multi-generational families. 

The program will provide up to $395,000 in financing to a maximum of 15 single-family landlords so they can build ADUs “such as backyard cottages, garage studios, attached in-law suites, basement apartments, and attic space conversions” to their land, according to a press release.

By helping existing residents expand their square footage, the City hopes to help seniors “spend their retirement years in their chosen neighborhood,” enable in-laws to move in with young families, make space for children returning from college and otherwise help ease the current real estate crisis without “significantly changing existing neighborhoods.” 

Other program targets include “seniors who need space for a caregiver, a multigenerational household who want separate living spaces, or young parents with a little one on the way,” Mayor Eric Adams added in the release. 

The money for the program comes from a $2.6 million state grant for “crafting community-centered solutions to encourage low- and middle-income homeowners to create or upgrade good quality, safe accessory dwelling units” which the City plans to significantly match, as NYS Homes and Community Renewal Commissioner RuthAnne Visnauskas explained. 

“ADUs financed through the program will become safe, habitable and potentially rent-restricted units that will help homeowners generate additional income and support long-term homeowner and neighborhood stability,” the press release noted.

Looking to apply? 

Eligible, two-person homeowner households must earn $186,450 or less, must be the owner-occupants of their property and must be current on any existing mortgages and not have outstanding municipal arrears or be in an active payment plan.

As well, their property must fit a variety of eligibility requirements, including ceiling height minimums. The full list is available on the Housing Preservation & Development Department’s website.

Applications are being accepted through February 13.