New York presents two very different ADU landscapes depending on where you're looking. New York City has its own set of reforms aimed at legalizing basement apartments and above-garage units in outer borough neighborhoods. The rest of the state — from Westchester County suburbs to small upstate cities — operates under a patchwork of local rules with no statewide preemption law to set a floor. For investors, the opportunity and the complexity vary dramatically by location.
New York City: The Basement Apartment Legalization Program
New York City's approach to ADUs has focused primarily on basement and cellar apartment legalization. The city has an enormous existing stock of illegal basement units — estimates range into the hundreds of thousands — and after the 2021 storm flooding deaths in basement apartments, the city launched the Basement Apartment Conversion Pilot Program to create a legal pathway for qualifying units.
The pilot program, which launched with a limited set of participating Community Districts and has been expanding, allows owners to legalize existing basement units that meet fire safety, egress, and minimum ceiling height requirements. The program provides some flexibility on code compliance that would otherwise be cost-prohibitive for conversion. The city also created a forgivable loan program to help owners fund required upgrades.
New construction ADUs in NYC are also allowed in many residential districts, though the rules vary by zoning district designation. In R1 and R2 districts (the lowest-density single-family zones), ADUs are generally not permitted as a matter of right. In R3–R6 districts, accessory apartments are more commonly allowed, subject to floor area ratio limits and lot coverage requirements. The city's zoning resolution is dense, and the rules for accessory apartments are scattered across multiple sections. Using the Department of City Planning's ZoLa (Zoning and Land Use Application) tool is the most efficient way to research rules for a specific parcel.
Westchester County and the Inner Suburbs
Westchester County is a collection of 43 municipalities, each with its own zoning code. Rules vary from village to village. Some Westchester municipalities — White Plains, Yonkers, and Mount Vernon among them — are relatively urban and have traditionally allowed accessory apartments in residential zones. Smaller, wealthier villages have historically been more restrictive, using minimum lot size requirements, owner-occupancy mandates, and design compatibility requirements to limit ADU development.
Westchester's towns have faced pressure to add housing following a high-profile federal fair housing settlement years ago, and that context has made some municipalities more cautious about being seen as resistant to housing. But there is no Westchester-wide ADU law, and the variation between municipalities is substantial. A lot in Scarsdale and a lot in Yonkers may both be zoned residential but face entirely different ADU rules.
Upstate New York: Albany, Buffalo, and Smaller Cities
Albany has been among the more proactive upstate cities on ADU reform. The city updated its zoning code as part of its ReZone Albany project, and ADUs are allowed by right in single-family residential districts subject to dimensional standards. Albany does not require owner-occupancy, and the city's code treats accessory dwelling units as a permitted accessory use rather than a conditional use requiring a special permit. The practical barrier in Albany is often the condition of the housing stock — many of the older single-family homes that would be candidates for ADU additions need substantial rehabilitation.
Buffalo has similarly updated its Green Code to be more permissive about accessory structures and secondary units. Buffalo's housing market, characterized by low prices and high vacancy rates, creates an unusual context where the investment math for ADU construction is challenging even where the zoning is permissive. The cost to build rarely exceeds the value added in many Buffalo neighborhoods.
Smaller upstate cities and towns are highly variable. Many small towns in rural New York have never thought about ADU policy at all — their codes are decades old and may not address accessory dwelling units explicitly, which means the answer to "can I build an ADU?" requires careful reading of the general accessory structure rules and possibly a call to the code enforcement officer.
The New York HOME Act
The New York HOME Act is a statewide ADU reform proposal that has been introduced in multiple legislative sessions but had not passed as of mid-2025. The proposal would require municipalities to allow ADUs by right in single-family zones, prohibit owner-occupancy requirements, and limit setback and size restrictions. If passed, it would fundamentally change the landscape for ADU investment across New York State, particularly in the resistant Westchester and Long Island suburbs.
Investors tracking New York should monitor the HOME Act's status, as passage would significantly change the risk-return profile of ADU plays in currently restrictive jurisdictions. But as of now, no preemption law exists outside of NYC, and each municipality must be researched independently.
Where Investors Find ADU Opportunity in New York
Given the patchwork nature of New York's ADU landscape, the most actionable opportunities for investors in 2025 are:
- New York City outer boroughs: Queens, Brooklyn, and the Bronx have substantial single-family and two-family zones where garage conversions, basement legalizations, and new detached ADUs are increasingly viable. The basement legalization pilot has created a pathway that did not exist before 2022.
- Albany and upstate cities with updated codes: Cities that have gone through comprehensive rezonings in the past five years are the most likely to have clear, investor-friendly ADU rules.
- Municipalities preemptively positioning for the HOME Act: Some municipalities are updating their ADU rules in anticipation of state preemption. These tend to be places with progressive land use commissions and existing housing pressure.
How to Research New York ADU Rules
- For NYC parcels, use the Department of City Planning's ZoLa tool to get the zoning district designation and then look up the accessory apartment rules for that district in the NYC Zoning Resolution.
- For municipalities outside NYC, identify the municipality (city, town, or village) that governs the parcel — in New York, a town may contain multiple villages with separate zoning codes.
- Look up the municipality's zoning code on Municode or the municipality's own website. Search for "accessory dwelling," "accessory apartment," and "family apartment."
- Check whether the municipality has a recent comprehensive plan that signals policy direction on housing and ADUs.
- Call the building department or zoning board office to confirm your reading and ask about processing timelines.