Florida's ADU Law Passes: Your Guide to $15K-$35K+ Rental Income

Four days ago, something happened in Tallahassee that's going to reshape real estate investing in Florida for the next decade. And honestly? Most investors aren't paying attention yet.

The Florida Senate just passed SB 1730 unanimously. That's right — unanimous. In today's political climate, getting every single senator to agree on anything is remarkable. But this ADU bill sailed through 37-0, and it's about to create serious cash flow opportunities for anyone who owns single-family residential property in the state.

If you've been sitting on the sidelines watching California and Massachusetts homeowners bank extra rental income from accessory dwelling units, your time has finally come. Let me break down what this means and how to position yourself to take advantage.

Breaking: Florida Senate Unanimously Passes Historic ADU Bill

On February 4th, 2026, the Florida Senate passed SB 1730, effectively removing the patchwork of local restrictions that have blocked ADU construction across the state for years. This isn't some watered-down compromise either — it's genuine reform.

Here's what makes this significant: Florida has been one of the most restrictive states for accessory dwelling units. While investors in California have been converting garages and building backyard cottages for years, Florida homeowners faced a maze of local ordinances that made ADU projects nearly impossible in most municipalities.

Senator Alexis Calatayud, who sponsored the bill, put it bluntly: homeowners should have the right to build additional housing on their own property without jumping through endless bureaucratic hoops. The unanimous vote signals that legislators on both sides recognize the housing crisis demands real solutions — not more red tape.

The bill now moves to the House, but given the Senate's unanimous support and Governor DeSantis's previous statements supporting property rights, most observers expect it to pass without major changes. Smart investors are already planning their moves.

What the New Florida ADU Law Means for Single-Family Homeowners

So what exactly does SB 1730 do? Let me cut through the legal language and give you the practical takeaways.

The big change: Local governments can no longer prohibit ADUs on single-family residential lots outright. If you own a single-family home in Florida, you'll have the right to add an accessory dwelling unit to your property.

Size allowances: The law permits ADUs up to 1,000 square feet or 50% of the primary dwelling's square footage, whichever is less. For most Florida homes, you're looking at somewhere between 750-1,000 square feet of buildable space. That's enough for a legitimate one or two-bedroom rental unit.

Parking requirements get reasonable: One of the biggest obstacles to ADU development has been excessive parking mandates. Some Florida municipalities required two additional parking spaces per ADU — essentially making projects financially unworkable on smaller lots. The new law caps parking requirements at one space per ADU, and even that can be waived if you're within half a mile of public transit.

Owner-occupancy rules relaxed: This is huge for investors. Many local ADU ordinances required the property owner to live in either the main house or the ADU. SB 1730 eliminates mandatory owner-occupancy requirements, meaning you can rent out both units. That's a game-changer for buy-and-hold investors.

Short-term rental note: The law does allow local governments to restrict ADUs from being used as short-term rentals (under 30 days). So if your strategy involves Airbnb, you'll need to check local rules. But for traditional rental income? The path is clear.

What the law doesn't do is override HOA restrictions, at least not entirely. Homeowners associations can still impose some limitations, though they cannot prohibit ADUs completely. If you're buying in an HOA community with ADU plans, read the covenants carefully.

The Income Opportunity: How ADUs Generate $15K-$35K+ Annually

Let's talk numbers, because this is where it gets exciting.

Based on rental data from markets where ADUs are already common, property owners are generating between $15,000 and $35,000+ in annual rental income from their accessory dwelling units. And in Florida's hot rental markets? I'd expect the higher end of that range.

Here's a realistic breakdown for different Florida markets:

Miami-Dade / Broward: A well-finished 800 square foot ADU in a decent neighborhood can command $1,800-$2,500/month. That's $21,600-$30,000 annually before expenses.

Orlando Metro: Slightly lower than South Florida, but demand is strong. Expect $1,400-$2,000/month for a comparable unit. Annual gross: $16,800-$24,000.

Tampa Bay: Similar to Orlando, with rental rates between $1,500-$2,200/month depending on location and finishes. You're looking at $18,000-$26,400 per year.

Jacksonville: More affordable market overall, but ADU rents still hit $1,200-$1,700/month. Annual range: $14,400-$20,400.

Coastal / Tourist Areas: If you're in a desirable coastal area and local rules permit longer-term vacation rentals, premiums can push income above $35,000 annually.

Now, these are gross numbers. You'll have expenses — property management, maintenance, vacancy, insurance increases, and potentially higher property taxes. But even after accounting for a 30-35% expense ratio, you're looking at substantial net income.

The math that matters: Construction costs for a new ADU in Florida typically run $150-$250 per square foot, depending on finishes and site conditions. For an 800 square foot unit, that's $120,000-$200,000. At the mid-range construction cost of $150,000 and a net annual income of $15,000, you're looking at a 10% cash-on-cash return. That beats most alternative investments right now.

And here's the kicker — you're also adding significant value to the property itself. Homes with permitted ADUs sell at premiums because buyers recognize the income potential.

Florida Joins the Movement: How CA and MA Are Also Expanding ADU Rights

Florida isn't pioneering this approach — it's catching up to a nationwide trend that's been building momentum for years.

California has been the ADU leader since 2016 when they passed their first major reform. Since then, they've progressively loosened restrictions. The results? ADU permit applications in California jumped from around 6,000 in 2017 to over 23,000 by 2022. Los Angeles alone has permitted more than 30,000 ADUs. The state recently passed additional reforms allowing ADUs on properties with multi-family buildings, not just single-family homes.

Massachusetts just enacted similar legislation in late 2024, making ADUs a "by-right" use on single-family lots statewide. Previously, Boston residents needed special permits that could take a year or more to obtain. The new rules allow units up to 900 square feet without special approval. Boston.com reported that real estate agents are already seeing increased interest in properties with ADU potential.

Oregon, Vermont, and Maine have also passed statewide ADU reforms in recent years. The pattern is clear: states are recognizing that allowing more housing units on existing residential lots is one of the fastest ways to address housing shortages without massive infrastructure investments.

Why does this matter for Florida investors? Because we can learn from what worked and what didn't in these other markets. California investors who moved early captured the best opportunities. Those who waited until ADUs became mainstream faced more competition and higher construction costs.

The same dynamic will play out in Florida. Early movers will have contractors' attention and less competition for tenants. Wait two years, and you'll be fighting for construction crews along with everyone else.

Getting Started: Steps to Add an ADU to Your Florida Property

Assuming the bill passes the House and gets signed (which looks likely), here's how to prepare:

Step 1: Evaluate your property's ADU potential

Not every lot is ideal for an ADU. You need to assess:

Available space (setbacks, easements, existing structures)
Access for construction equipment
Utility connections (sewer/septic capacity, electrical panel, water)
Topography and drainage
Existing improvements that might need modification

Properties with detached garages, large backyards, or existing outbuildings often have the best potential. Lots under 6,000 square feet can work but get trickier.

Step 2: Understand your local overlay

While SB 1730 establishes baseline rights, local governments retain some regulatory authority. They can still impose design standards, setback requirements, and utility connection rules. Check with your municipal planning department once the law takes effect.

Step 3: Run the numbers before committing

Get preliminary construction estimates. Talk to local property managers about realistic rental rates for the unit type you're considering. Factor in:

Construction costs (get at least three bids)
Permit and impact fees
Utility connection costs
Landscaping and site work
Financing costs if applicable
Time to complete (usually 6-12 months)

Step 4: Line up your team

You'll need:

An architect or designer familiar with ADU projects
A general contractor with residential experience (ADU specialists will emerge, but they're rare in Florida currently)
A real estate attorney to review contracts
A property manager if you don't self-manage

Step 5: Explore financing options

Several paths exist:

Cash (simplest but ties up capital)
Home equity line of credit on the primary property
Construction-to-permanent loan
Cash-out refinance of existing properties
Some lenders now offer ADU-specific loan products

Interest rates matter here. At current rates, you want to make sure your projected rental income covers debt service with room to spare.

Investment Strategy: Why Smart SFR Owners Are Acting Now

I've been investing in real estate for over 15 years, and I've seen regulatory changes create opportunity windows before. This is one of those moments.

Here's why I think the smart play is moving quickly:

Construction costs are only going up. Materials prices have stabilized somewhat from pandemic highs, but labor costs continue climbing. Every year you wait likely means 5-8% higher construction costs.

First-mover advantage in the rental market. When ADUs are rare, they command premium rents. As supply increases, that premium diminishes. Being among the first to market with a quality ADU in your neighborhood means better tenant selection and stronger rents.

Contractor availability. Right now, most Florida contractors aren't focused on ADUs. Once the law passes and awareness spreads, demand for ADU construction will spike. Getting your project in the pipeline early means better pricing and faster timelines.

Property acquisition angle. If you're actively buying, start evaluating properties through an ADU lens. A single-family home with a large lot and detached garage that pencils as a mediocre rental might become a cash cow with an ADU added. Other buyers aren't pricing this in yet.

For wholesalers, this creates a new value-add pitch. Finding properties with strong ADU potential and marketing that angle to investor buyers could differentiate your deals.

The contrarian take: Some investors will wait to see how the law shakes out, whether local governments create obstacles, how the rental market responds. That caution is reasonable. But in my experience, the investors who profit most from regulatory changes are the ones who prepare while others hesitate.

I'm not saying to rush into a poorly planned project. Do your due diligence. Run conservative numbers. But don't let analysis paralysis cost you a genuine opportunity.

The Bottom Line

Florida's unanimous ADU vote signals a fundamental shift in how the state approaches housing. For single-family property owners, this creates a clear path to $15,000-$35,000+ in additional annual income.

The opportunity is real. The timeline is now. And the investors who act decisively while others are still reading about it will capture the best returns.

Start evaluating your properties. Talk to contractors. Run your numbers. When this law takes effect, you'll want to be ready to move.

That's the difference between reading about opportunities and actually capturing them.