How Oregon’s Housing Legislation Is Shaping ADU Opportunities in 2025

Oregon continues to lead the nation in progressive housing reform — and 2025 is shaping up to be one of the most transformative years yet. Across the state, lawmakers and local governments are making it easier for homeowners to build Accessory Dwelling Units (ADUs) as part of a broader effort to address housing shortages, promote affordability, and encourage smarter land use.

For Central Oregon homeowners — particularly those in Bend, Redmond, Sisters, and unincorporated Deschutes County — these policy updates create new opportunities to build equity, generate income, and provide space for family or renters without leaving their neighborhood.

Oregon’s Push for Housing Innovation

Oregon’s housing challenges are no secret. Rapid population growth, limited developable land, and rising construction costs have made it increasingly difficult for residents to find affordable homes.

Recognizing this, Oregon has spent the past several years enacting a series of statewide housing bills aimed at making it easier for homeowners to add small-scale housing, increase density, and create more flexible living spaces.

These efforts directly support the state’s long-term vision for sustainable growth — one where cities and counties can expand inward rather than outward, protecting farmland and forests while meeting housing needs.

Key Laws Driving ADU Growth in 2025

Three main pieces of legislation are shaping Oregon’s ADU landscape right now.

SB 1051: The Foundation for Urban ADUs

First passed in 2017, Senate Bill 1051 laid the groundwork for today’s ADU expansion. It requires every Oregon city to allow at least one ADU on every single-family residential lot.

For homeowners in places like Bend and Redmond, this means you no longer need to own a massive lot or go through complex rezoning to add a second living unit.

In 2025, most cities have gone even further — removing owner-occupancy rules, relaxing parking standards, and simplifying design codes to speed up ADU approvals.

HB 2001: Opening the Door to “Middle Housing”

House Bill 2001, passed in 2019, complements ADU reform by requiring medium and large cities to allow duplexes, triplexes, and cottage clusters in areas once zoned exclusively for single-family homes.

The result? A gradual diversification of Oregon neighborhoods, where smaller, more affordable homes can coexist alongside traditional houses.

For Central Oregon, this has opened doors for creative developments like:

• Cottage-style micro-communities in Bend’s westside neighborhoods.

• Duplex and triplex infill projects in Redmond and Prineville.

• Mixed-use residential designs that blend live-work flexibility.

While HB 2001 doesn’t specifically govern ADUs, it complements them — allowing homeowners and builders to mix housing types and create more dynamic neighborhood layouts.

SB 391: Expanding ADUs Into Rural Oregon

Perhaps the most impactful recent change for Central Oregon is Senate Bill 391, passed in 2021. This law allows counties to approve one ADU on certain rural residential lots, even those outside urban growth boundaries.

Previously, state land-use rules prevented most rural homeowners from building secondary dwellings. But SB 391 changed that, giving counties like Deschutes new flexibility — with some important conditions:

• The lot must already have a single-family home.

• The ADU must meet wildfire risk reduction standards (such as defensible space and fire-resistant materials).

• The property must comply with septic system capacity and setback requirements.

In 2025, Deschutes County has fully integrated SB 391 into its planning code, making rural ADUs possible — though still subject to careful review for safety and environmental protection.

What This Means for Bend and Deschutes County Homeowners

For homeowners in Bend, these statewide laws translate to a smoother, faster path to building an ADU. The city has actively supported ADU development as part of its comprehensive housing strategy — offering streamlined permitting, reduced fees, and flexible design options.

For those living just outside the city limits in unincorporated Deschutes County, the new rules under SB 391 are a game-changer. While the process is still more complex than inside Bend, rural residents now have the chance to build guest quarters or full ADUs where it was once impossible.

Whether you want to:

• Create a rental unit for supplemental income,

• Build a home for aging parents, or

• Add a private space for guests or remote work —these new laws make it easier to do so while adding lasting value to your property.

How These Changes Support Affordability and Smart Growth

By allowing ADUs in both urban and rural areas, Oregon is tackling housing affordability on multiple fronts. ADUs help:

• Increase local housing supply without expanding urban boundaries.

• Provide naturally affordable options for renters and families.

• Give homeowners flexibility to adapt to life changes — whether that’s growing families or downsizing.

• Encourage sustainable development by maximizing existing infrastructure and reducing sprawl.

For Bend, this means more infill housing options that maintain neighborhood character. For Deschutes County, it allows homeowners to contribute to housing diversity while preserving the region’s rural charm.

Navigating the New Rules

Even with streamlined legislation, building an ADU still requires careful planning. Each jurisdiction interprets state law slightly differently, especially around:

• Building height and design

• Parking requirements

• Short-term rental restrictions

• Wildfire zone construction standards

Before submitting plans, homeowners should verify local codes with:

• City of Bend Planning Division

• Deschutes County Community Development Department

• State Building Codes Division (for rural ADUs)

Working with a local builder or realtor familiar with ADU regulations can also save time and prevent costly mistakes.

Oregon’s bold housing reforms are reshaping what’s possible for homeowners across Central Oregon. Whether you live in downtown Bend or on acreage near Tumalo, 2025’s ADU-friendly laws offer an unprecedented opportunity to add space, value, and income to your property.

By understanding the nuances of Oregon’s ADU law 2025 and how they apply locally, you can make informed decisions that align with your goals — and help shape a more sustainable, flexible future for Central Oregon housing.

FAQs

Q: What’s the biggest benefit of these new ADU laws?

A: More flexibility. Homeowners can now build income-generating or family units with fewer barriers — increasing both property value and housing availability.

Q: Do statewide laws override local zoning codes?

A: Not entirely. State laws like SB 1051 and SB 391 set minimum standards, but cities and counties can add local conditions for safety, wildfire protection, and infrastructure limits.

Q: How long does it take to get an ADU permit in Bend or Deschutes County?

A: Most ADU permits are approved within 30–60 days, assuming the design meets zoning and safety requirements.

Q: Can I build an ADU on my rural property?

A: Yes, under SB 391, but you must meet strict fire, septic, and land-use conditions. Deschutes County requires documentation before issuing a permit.

Q: Can I rent my ADU short-term on Airbnb or VRBO?

A: In Bend, short-term rentals are allowed in certain zones with permits. In rural Deschutes County, short-term rentals are more limited due to land-use rules.