Wilmington's ADU Permitting: From Restrictive to Trendy

Wilmington has quietly become one of North Carolina's most ADU-friendly cities. Accessory dwelling units — detached cottages, garage apartments or converted carriage houses — used to face strict limits on size, location and parking. Zoning rules capped ADUs at 900 sq ft and barred them from lots that didn't meet minimum width or area.

Over the past few years city officials have loosened almost every restriction. By 2024 the maximum ADU size increased to 1,200 sq ft, homeowners can build on non‑conforming lots and the units may be up to half the size of the main house, though they still can't exceed its height. A 2024 vote also removed on‑site parking requirements. Wilmington's zoning administrator noted that about 97.5 percent of the city's roughly 30,000 residential lots are now eligible for an ADU, opening more than 27,000 potential sites.

These reforms have sparked a surge in ADU construction. Wilmington already has around 700 units, used for multigenerational living, rental income or guest suites. The city's Rental Rehabilitation Incentive Loan Program offers up to $200,000 interest‑free to build or renovate an ADU as long as it is rented at an affordable rate. Local builders report growing demand from families who want to house aging parents or earn passive income. With relaxed zoning, rising housing costs and flexible loan programs, ADUs are likely to become even more common in Wilmington over the next few years.

What was once an uncommon backyard cottage is becoming a mainstream housing option. With the majority of residential lots now ADU‑eligible and new financial incentives available, homeowners have more freedom than ever to unlock the value of their property.