If you've been house hunting in Summit County or thinking about adding value to your property, you've probably heard the term "ADU" thrown around a lot lately. Accessory Dwelling Units are one of the most talked-about tools in our local housing market right now — and for good reason. They can add rental income, house a family member, or provide workforce housing, all without needing to buy a second property.
But ADU rules aren't one-size-fits-all here. Summit County and each of our five towns — Breckenridge, Frisco, Silverthorne, Dillon, and Blue River — all handle ADUs a little differently. Here's a plain-English breakdown of what you need to know before you build, buy, or sell a property with one.
What Is an ADU, Exactly?
An Accessory Dwelling Unit is a smaller, secondary living space on a residential lot. It might be:
- Attached — built into the main home, like a basement apartment
- Detached — a separate structure, like a cottage or a unit above a garage
- A garage or outbuilding conversion — living space added above or below a garage
Across nearly all of Summit County's jurisdictions, ADUs come with one big string attached: they're intended to help solve the local workforce housing shortage, not to become a second short-term rental or a free-standing property you can sell separately.
Unincorporated Summit County: The Basics
If your property sits outside town limits — in unincorporated Summit County — the rules are set by the Summit County Land Use & Development Code. Here's what stands out:
The permitting process is streamlined. In most cases, you only need a building permit to add an ADU — no separate planning review is required first. (A couple of exceptions apply, such as ADUs on duplex lots or in certain Planned Unit Developments, which still need a Class 2 planning review.)
A deed restriction is required. Every ADU in unincorporated Summit County must be deed restricted, limiting occupancy to a "Qualified Occupant" — essentially a local worker — or a relative of the property owner. The county currently offers three different covenant options:
- Standard ADU Covenant (no fee waiver) — best if you don't plan to keep the ADU for a full 10 years
- ADU Fee Waiver Covenant — waives county building, planning, and engineering fees if you commit to using the ADU per the covenant for at least 10 years
- ADU Assistance Program Covenant — only for homeowners approved for the county's financial assistance program
There's money available to help build one. Through the Summit County ADU Assistance Program, the county will reimburse up to $60,000 toward the cost of building a new ADU, and funds can even be used for water and sewer tap fees in areas served by participating districts. The county has also developed free "stock plans" for several ADU styles (Shed, Double Stack, Single Stack, and Coop designs) so homeowners can skip the cost of hiring an architect.
A few practical things to check before you build:
- Water and sewer: If you're on a central system, confirm your district has capacity for an added unit. If you're on a well, you'll likely need to augment your water rights and update your well permit through the Colorado Division of Water Resources. If you're on septic, your system and leach field need enough capacity for the extra bedroom(s).
- Building code: Converting existing space into an ADU triggers fire and sound separation requirements between units, and the electrical panel must be accessible to both households.
- Engineering: Grading, drainage, and any work near wetlands or floodplains may require a separate Grading and Excavation Permit.
How the Towns Differ
Here's where it gets important for buyers and sellers — each town sets its own rules, separate from the county.
Breckenridge
Breckenridge has been actively reworking its ADU rules to spur more construction. As of mid-2026, Town Council approved changes that remove the previously mandatory workforce-housing deed restriction for new ADUs. Town planning staff had found that the old blanket deed-restriction requirement discouraged many homeowners from building ADUs in the first place, limiting flexibility and rental income. The town still preserves incentives (sometimes called "positive points") for owners who voluntarily deed-restrict their ADU for workforce housing. Council has said it will monitor how the change affects short-term rental activity, particularly in Breckenridge's more restrictive residential zones, so if you're considering an ADU project in town, it's worth checking in with Breckenridge Community Development for the very latest rules before you design your plans.
Silverthorne
Silverthorne requires a Single Apartment Conditional Use Permit for an ADU, which currently carries a $300 application fee. The good news for homeowners: this permit does not require a hearing before the Planning Commission or Town Council — it's handled administratively. As of mid-2026, Silverthorne has also transitioned its building permit and inspection services to a third-party provider (Comprehensive Building Code Services), so if you're mid-project, confirm which office is handling your review.
Frisco
Frisco is one of the most ADU-friendly towns in the county. The town's land use code allows accessory dwelling units in almost all zone districts, and Frisco treats ADUs as a genuine incentive tool — giving homeowners an extra unit of density on their lot, along with a source of rental income. Deed restrictions in Frisco vary depending on when they were recorded; the town's 2019 Residential Housing Restrictive Covenant is available for owners who want to opt into updated, standardized terms.
Dillon
Dillon takes a more structured approach. ADUs are limited to the Residential Low Density (RL) and Residential Medium Density (RM) zone districts — they're not allowed in multi-family buildings or townhomes. Dillon allows both:
- ADUs within duplex units, and
- Detached ADUs on permanent foundations, capped at 600 square feet with a minimum 30-foot setback from lot lines
Every ADU approval in Dillon requires payment of water and sewer tap fees, a recorded covenant preventing the unit from ever being subdivided into separate ownership, and a deed restriction barring short-term rental use — meaning the unit can't be rented for periods shorter than six months.
Blue River
Blue River has the most involved review process of the five towns. Because of the town's mountainous terrain and strict building standards, an ADU is treated as a Type A Permit, which requires approval from the Blue River Planning & Zoning Commission (meetings are held the first Tuesday of each month, with applications due three weeks in advance). New ADUs also require an Improvement Survey Plat prepared by a licensed surveyor, along with full architectural, structural, electrical, mechanical, and plumbing plans — similar to what you'd submit for a new home. If you're considering a property in Blue River with ADU potential, budget extra time and professional fees for this more rigorous process.
What This Means for You
If you're a buyer: An existing ADU can be a great source of rental income or space for family — but always ask whether it's deed restricted, what the occupancy restrictions are, and whether it was permitted correctly. An unpermitted or non-compliant ADU can create headaches at closing or during financing.
If you're a seller: Know your ADU's covenant type and terms cold. Buyers and their lenders will ask, and having your paperwork (covenant, permits, and any water/sewer documentation) organized in advance makes for a smoother transaction.
If you're a homeowner considering building one: Start with a conversation with your town's (or the county's) planning department before you draw up plans. Confirm zoning eligibility, water/sewer capacity, and covenant requirements early — it can save significant time and redesign costs down the road.
Questions About ADUs on a Property You're Buying or Selling?
Every ADU situation in Summit County is a little different depending on where the property sits and when the unit was built. If you're evaluating a listing with an ADU, or thinking about adding one to your own property, our team at Nelson Mountain Real Estate can help you understand what it means for value, financing, and long-term use. Reach out — we're happy to walk through it with you.
This article is intended as general information and is not a substitute for guidance from Summit County or your town's planning department. Regulations change; always confirm current requirements before making a purchase or building decision.