Complete 2026 cost breakdown: construction, permits, financing, and expected rental ROI.
Calculate your Denver ADU cost →Building an ADU in Denver costs between $200,000-$450,000 for new construction, with per-square-foot costs averaging $250-$500. These figures include design, permitting, site preparation, and construction. The most affordable option is a garage conversion at $80,000-$150,000, while prefab/modular ADUs fall in between at $175,000-$425,000.
| Cost Category | Estimated Range |
|---|---|
| Architectural Plans | $3,000 – $15,000 |
| Permits & Fees | Building permit is valuation-based: $770 + $5.60 per $1,000 over $100,000 (about $1,330 at $200,000) plus a 50% plan-review fee; zoning permit $150 + $0.50 per $1,000; SUDP $425 application + $150 inspection; Denver Water ADU system development charge $2,170 (from Jul 1, 2026). |
| Impact Fees | Denver has no development impact fee, and ADUs are an exception to the affordable-housing linkage fee (DRMC 27-154; documented at building permit). Denver Water ADU SDC $2,170 inside Denver; a sanitary connection fee applies only if the ADU gets its own water service instead of sharing the house's. |
| Site Prep & Foundation | $10,000 – $35,000 |
| Framing & Structure | $15,000 – $45,000 |
| Plumbing | $8,000 – $20,000 |
| Electrical | $5,000 – $15,000 |
| HVAC | $3,000 – $8,000 |
| Interior Finishes | $15,000 – $40,000 |
Quotes for the same ADU commonly vary 20–40% between builders. We pass your request to up to 5 local builders serving Denver, where we have them — free, no obligation.
Get Denver builder quotes →Permit fees in Denver are Building permit is valuation-based: $770 + $5.60 per $1,000 over $100,000 (about $1,330 at $200,000) plus a 50% plan-review fee; zoning permit $150 + $0.50 per $1,000; SUDP $425 application + $150 inspection; Denver Water ADU system development charge $2,170 (from Jul 1, 2026).. The review timeline is Not published as a fixed figure: Denver's Average Plan Review Times dashboard (updated daily) shows current 'Major Residential' review times. Trade permits for new construction need the issued residential construction permit first (since May 22, 2025)., with plan check: Zoning, building and SUDP reviews run concurrently when all required documents are uploaded with the initial application; a property survey is needed if building within 3 ft of a lot line. New construction over 500 sq ft also needs an approved URCO waste-diversion plan and refundable deposit before the permit issues.. Impact fees are Denver has no development impact fee, and ADUs are an exception to the affordable-housing linkage fee (DRMC 27-154; documented at building permit). Denver Water ADU SDC $2,170 inside Denver; a sanitary connection fee applies only if the ADU gets its own water service instead of sharing the house's.. Pre-approved plans: None: Denver CPD offers no pre-approved ADU plan set (only a sample site plan and elevations, checked Sept 2026). Any plan or fee help under Colorado's HB 24-1152 grant program would be announced by the city, not by this page..
| 1-Bedroom Rent | $1,650-$2,000/month |
| 2-Bedroom Rent | $2,000-$2,500/month |
| Annual Rental Income (est.) | $21,900/year |
| Payback Period (est.) | 14.8 years |
| Short-Term Rental | Yes, with a Denver STR licence: the host's primary residence must be on the same lot; an ADU accessory to a single-unit home may be the STR, but not if the host lives in the ADU (DZC 11.8.10.1.C, F) |
| Overall ROI Estimate | 5-8% gross rental yield on build cost |
A typical ADU in Denver generates approximately $21,900 per year in rental income based on average 1-bedroom rents. At an average construction cost of $325,000, the estimated payback period is 14.8 years — before accounting for the resale value the ADU adds, which an appraiser determines from comparable sales in Denver and varies by market (often less than build cost).
1. Garage conversions save 40-60% vs new construction since the shell already exists. Average cost in Denver: $80,000-$150,000.
2. Prefab/modular ADUs offer predictable pricing and faster timelines. Average: $175,000-$425,000.
3. Pre-approved plans — available in Denver, which can save $3,000-$10,000 in design costs and 2-3 months in review time. See which cities offer pre-approved ADU plans.
4. State grants — California's CalHFA ADU grant (up to $40K) is currently paused; check calhfa.ca.gov/adu for status and your state for active programs.
5. Get multiple bids — ADU contractor pricing varies 20-40% for the same project. We recommend getting at least 3 quotes.
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