How Do I Create a Rental Unit On My Property?

Is an accessory dwelling unit the same as an affordable dwelling unit?


No. Affordable dwelling units are for households who meet income requirements. Accessory dwelling units do not have income requirements.




How do I know if I can create a rental unit on my property?


Start by checking your neighborhood’s zoning rules to determine if a rental unit is allowed on your property.

  • If your block is yellow on this map, you may be able to create an accessory dwelling unit. Depending on where you live, your property must be at least 1,200 or 2,000 square feet. You must also live on the property where the accessory dwelling unit is located while it’s rented.
  • Or, if your block is yellow on this map—primarily neighborhoods with row houses—your property may become a two-family flat, which is a dwelling with no more than 2 units.
To learn about the zoning regulations for your property, you can look up your address, or schedule a meeting with the Department of Consumer and Regulatory Affairs (DCRA) to learn more.




Do I need to build a separate building structure to create a rental unit?


No. Parts of your existing home, such as an English basement, can be turned into a rental unit.




Do I need to get approval from DC Government if I end up building an accessory dwelling unit?


Yes. To build a separate structure for an accessory dwelling unit, you need to apply for a building permit through the Department of Consumer and Regulatory Affairs (DCRA) and satisfy all building and zoning codes.




What are the steps to build an accessory dwelling unit from scratch?


The typical process for building an accessory dwelling unit follows these steps:

  1. You check if your property is allowed to have an accessory dwelling unit based on zoning laws.
  2. You find an architect or designer who knows about local building laws.
  3. The architect visits your property and gives you a proposal that describes their services and fees.
  4. The architect creates a design for the accessory dwelling unit based on your needs and goals that also meets DC Code. Plans must also include electrical, plumbing, and other technical plans.
  5. You or the architect submit a project application using the Department of Consumer and Regulatory Affairs (DCRA) Permit Wizard to begin the plan review process.
  6. DCRA may need to consult other DC agencies, such as the Department of Transportation, the Department of Energy & Environment, or quasi-governmental agencies, such as DC Water about your plan.
  7. After the plan review is complete, usually 45-60 days, DCRA will issue the approved permits for your project.
  8. You share building drawings with, and compare bids from, multiple contractors. You should check references and legal documents before choosing a contractor. The DCRA Contractor Rating System can help you find properly-licensed and high-performing building professionals for your project.
  9. The accessory dwelling unit is built. The architect helps make decisions about building materials and responds to unexpected changes in the project. Building inspectors visit the construction site to make sure the project follows regulations.




Can I get a loan to help pay for the cost of building the accessory dwelling unit?


If you have a stable income, a good credit score, and enough home equity, you may qualify for a loan. Before finding a lender, you’ll need to estimate the total project cost, including architectural and permitting fees.




Do I need to get approval from DC Government for a rental unit?


Yes. Before renting out the unit, you must complete inspections while building (as required) and then a final inspection to ensure that your property is safe to live in and meets the requirements for a rental unit. Once your unit has been inspected, you must apply for a Basic Business License.




What are some of the benefits of a rental unit?


A rental unit can give homeowners extra income to go towards household costs such as property taxes. These units also help create additional housing in neighborhoods where there may be few rental options.




Who can rent a unit in my home?


Anyone who agrees to the terms of the lease. When selecting a tenant, you should run credit and background checks. You must follow fair housing guidelines that prevent discrimination based on race, color, national origin, religion, sex, familial status, or disability. You can also rent to households that participate in housing assistance programs, such as the Housing Choice Voucher program. Submit an interest form to the DC Housing Authority to learn more about renting to households in this program.




Can I rent the unit on Airbnb?


If you decide to rent out a unit on your property as an Airbnb, there are some additional requirements. You’ll need a short-term rental license and appropriate insurance. You cannot rent the unit on Airbnb for more than 30 days at one time or more than 90 days each year.




I have a question that’s not covered here. Who can I contact?


If you have a question about zoning for rental units, call the Office of the Zoning Administrator at (202) 442-4576. They are open Monday, Tuesday, Wednesday, and Friday 8:30 am to 4:30 pm and Thursday 9:30 am to 4:30 pm.
If you have a question about permits or business licenses, contact DCRA using the online form, emailing dcra@dc.gov, live chatting with us on dcra.dc.gov, or calling (202) 442-4400. They are open Monday, Tuesday, Wednesday, and Friday 8:30 am to 4:30 pm and Thursday 9:30 am to 4:30 pm.




Should I hire a property manager?


It’s up to you. You can manage the property yourself or hire a property manager. A property manager would do things like screen tenants, collect rent, make repairs, and pay utility bills on your behalf. A property manager can cost up to 8-10% of the gross rent—meaning the total monthly rent and utility costs—of the rental unit.





Most single family homes in the District of Columbia are allowed to have a rental unit. Rental units are typically in the basement or backyard of the property. They’re sometimes called accessory dwelling units or two-family flats, depending on the zoning rules for your home. All rental units must have a separate entrance, as well as permanent rooms and appliances for living, sleeping, eating, cooking, and sanitation.

Keywords: homeowners, rental unit, rent my home, rent out, how to rent out my house, extra income

 

This page was last updated July 2021.