The Complete NYC ADU Glossary: Every Term You Need to Know

the NYC ADU world is full of acronyms, technical terms, and bureaucratic jargon. if you've ever stared at a zoning map, a DOB filing, or a PLUTO dataset and felt lost, this glossary is for you.

we've compiled every term you're likely to encounter during the ADU research, planning, and construction process — explained in plain english.

core ADU terms

ADU — Accessory Dwelling Unit

a secondary housing unit on a property that already has a primary residence. can be a detached backyard cottage, a basement apartment, a garage conversion, or an above-garage unit. NYC legalized ADUs for 1-3 family homes in specific zoning districts. the ADU can be up to 800 sq ft or 33% of the primary home's floor area (whichever is less).

DADU — Detached Accessory Dwelling Unit

an ADU that is a separate, standalone structure — not physically attached to the primary home. typically a backyard cottage. requires its own foundation, walls, roof, and utility connections.

AADU — Attached Accessory Dwelling Unit

an ADU that is physically connected to the primary home — a basement apartment, garage conversion within the existing structure, or an addition built onto the main house.

primary dwelling

the main house on the property. the homeowner must live in the primary dwelling to build and maintain an ADU (owner-occupancy requirement).

owner-occupancy

the requirement that the property owner lives in either the primary dwelling or the ADU. this is a condition of the NYC ADU program and the property tax exemption.

zoning and land use terms

FAR — Floor Area Ratio

the total building floor area divided by the lot area. a FAR of 0.5 on a 4,000 sq ft lot means you can build up to 2,000 sq ft of total floor space (including all structures). ADU floor area counts toward your property's FAR. this is one of the most important zoning constraints for ADU construction — if you're already at or near your FAR limit, you may not be able to add an ADU without a variance.

R3-1, R3-2, R3X, R3A, R4

residential zoning districts. these are the primary ADU-eligible zones in NYC:

• R3-1: detached homes, 3,800 sq ft min lot
• R3-2: detached/semi-detached, 2,850 sq ft min lot
• R3X: detached, 3,325 sq ft min lot
• R3A: contextual, detached homes
• R4: general residential, various housing types

setback

the required distance between a building and the property line. ADUs must comply with front, side, and rear yard setback requirements. rear yard setbacks are usually the most relevant for backyard ADUs — typically 20-30 feet from the rear lot line, depending on zoning district.

lot coverage

the percentage of the lot area covered by buildings. some zoning districts limit lot coverage to 35-65%. your ADU's footprint counts toward this limit.

use group

the building code classification for how a building is used. residential ADUs fall under Use Group R-3 (one- and two-family dwellings) in the NYC Building Code.

contextual zoning

zoning districts (like R3A) that include additional regulations about building form — height limits, setback requirements, and lot coverage — designed to keep new construction consistent with the existing neighborhood character.

variance

a special permission from the Board of Standards and Appeals (BSA) to build something that doesn't comply with zoning rules. variances are difficult and expensive to obtain (legal fees of $20K–$50K+, 6–12 month process). most ADU projects should be designed to comply with zoning without needing a variance.

NYC data and identification terms

BBL — Borough, Block, Lot

the unique identifier for every property in NYC. a 10-digit number: 1 digit for borough (1=Manhattan, 2=Bronx, 3=Brooklyn, 4=Queens, 5=Staten Island), 5 digits for block, 4 digits for lot. example: 3-08765-0042 = Brooklyn, block 8765, lot 42. you'll need your BBL for permit filings, tax records, and the eligibility checker.

BIN — Building Identification Number

a 7-digit unique identifier for every building in NYC (different from BBL, which identifies the lot). a single lot can have multiple BINs if it has multiple buildings. your ADU will get its own BIN once it receives a certificate of occupancy.

PLUTO — Primary Land Use Tax Lot Output

the NYC Department of City Planning's comprehensive property dataset. PLUTO contains zoning, building dimensions, lot area, FAR, land use, and dozens of other attributes for every tax lot in NYC. the nycadu eligibility checker uses PLUTO data to determine your property's ADU eligibility.

proxcode

the proximity code in PLUTO data that describes a building's relationship to neighboring properties. values include: detached, semi-detached, attached. this is relevant for ADU eligibility because some zoning districts only allow ADUs on detached properties.

permits and regulatory terms

DOB — Department of Buildings

the NYC agency that issues building permits, conducts inspections, and enforces the building code. all ADU construction requires DOB permits. filings are done through the DOB NOW online portal.

DOB NOW

the online portal for filing building permits, scheduling inspections, and tracking application status. everything is done electronically — no more paper filings. access at nyc.gov/dobNOW.

CO — Certificate of Occupancy

the document issued by DOB that certifies a building is safe and legal for occupancy. you cannot legally rent your ADU until you have a CO. getting the CO is the final step in the construction process.

TCO — Temporary Certificate of Occupancy

a temporary version of the CO that allows occupancy while minor items are still being completed. valid for 90 days and renewable. some homeowners move tenants in under a TCO while finishing punch list items.

NB — New Building

a DOB application type for new construction. a detached backyard ADU is typically filed as an NB application.

ALT — Alteration

a DOB application type for modifications to existing buildings. basement and garage conversions are typically filed as ALT applications (specifically ALT-1 for major work or ALT-2 for minor work).

HPD — Department of Housing Preservation and Development

the NYC agency responsible for housing policy and enforcement. HPD plays a role in ADU policy, affordable housing requirements, and the Plus One ADU Program.

DCWP — Department of Consumer and Worker Protection

the agency that licenses home improvement contractors in NYC. any contractor doing ADU work must hold a valid DCWP home improvement license. verify licenses here.

financial and financing terms

AMI — Area Median Income

the median household income for the NYC metropolitan area, as determined by HUD. used to set income limits for housing programs including the Plus One ADU Program. for 2026, the AMI for a family of four is approximately $115,000. the Plus One program covers households up to 165% AMI (~$190K for a family of 4).

HELOC — Home Equity Line of Credit

a revolving credit line secured by your home equity. you borrow against the value of your home minus your mortgage balance. see our financing comparison for how HELOCs stack up against other ADU financing options.

LTV — Loan-to-Value Ratio

the ratio of your total mortgage debt to your home's appraised value. an 80% LTV means you owe 80% of your home's value. most HELOCs require you to maintain at least 15–20% equity (80–85% LTV or less) after drawing funds.

DTI — Debt-to-Income Ratio

your total monthly debt payments divided by your gross monthly income. lenders typically want DTI below 43% for ADU financing approval.

DSCR — Debt Service Coverage Ratio

rental income divided by total loan payment. a DSCR of 1.2 means your rental income is 120% of your loan payment — a healthy margin. lenders want 1.2x minimum; aim for 1.3x+.

Plus One ADU Program

NYC's flagship ADU financing program offering up to $395,000 in construction financing at below-market interest rates (3–5%). designed for moderate-income homeowners. see the financing page for full details.

construction terms

rough-in

the stage of construction where electrical wiring, plumbing pipes, and HVAC ductwork are installed inside the walls/floors/ceilings before they're closed up with drywall. must be inspected and approved before walls are closed.

egress

a means of exiting a building in an emergency. every habitable room in an ADU must have an egress window or door. basement ADUs require specific egress requirements — typically a window that's large enough to climb through (minimum 5.7 sq ft opening) with a window well if below grade.

MEP — Mechanical, Electrical, Plumbing

the three major building systems that make a space habitable. MEP work is typically the most expensive phase of ADU construction after structural work.

punch list

a list of minor items that need to be completed or corrected after the main construction is done but before final sign-off. examples: touch-up paint, hardware installation, minor adjustments. typically addressed in the last 1–2 weeks of a project.

change order

a written modification to the construction contract that changes the scope of work, timeline, or cost. all changes during construction should be documented as change orders — never agree to verbal changes without written documentation.

builder's risk insurance

insurance that covers damage to a structure during construction (fire, weather, theft). separate from your homeowner's policy. see our insurance guide for details.

tax terms

assessed value

the value that NYC's Department of Finance assigns to your property for tax purposes. not the same as market value — for Class 1 properties, assessed value is approximately 6% of market value.

Class 1 property

NYC's property tax classification for 1–3 family residential homes. Class 1 properties get the most favorable tax treatment: 6% assessment ratio, 6%/year assessment increase cap, 20%/5-year cap. most ADU-eligible homes are Class 1.

STAR — School Tax Relief

a NYS property tax exemption that reduces school taxes for owner-occupied primary residences. compatible with the ADU tax exemption — you can have both.

depreciation

a tax deduction that allows you to recover the cost of your ADU over 27.5 years (for residential rental property). on a $200K ADU, that's approximately $7,270/year in non-cash deductions against your rental income. this is one of the biggest tax advantages of rental property ownership.

other important terms

expediter

a professional who manages DOB filings, responds to objections, and shepherds your permit application through the review process. good expediters know the DOB system inside and out and can prevent costly delays. typical fee: $2,000–$5,000.

as-built drawings

drawings that show how a building was actually constructed (as opposed to the original design drawings, which show how it was planned to be built). useful for existing basement or garage conversions where the actual conditions may differ from original plans.

certificate of compliance

a document from utility companies confirming that utility connections (electric, gas, water, sewer) meet their requirements. typically needed before final DOB inspection.

FEMA flood zone

areas identified by FEMA as having elevated flood risk. relevant for ADU construction because: (1) flood insurance may be required, (2) basement ADUs in flood zones need special construction methods, (3) utility connections must be elevated above flood level. check your property's flood zone status at FEMA's flood map service.

Con Ed / National Grid

the two main utility providers for NYC. Con Edison handles electricity (and some gas/steam), National Grid handles natural gas. your ADU will need service connections from both, and scheduling these connections is often one of the longer lead-time items in construction (2–6 weeks).

DEP — Department of Environmental Protection

the NYC agency responsible for water supply and sewer systems. relevant for ADU construction because new water and sewer connections require DEP approval and may require a tap connection permit.

know a term we missed? have a question about something not on this list? the ADU regulatory landscape is constantly evolving — check back regularly as we update this glossary.

ready to put these terms into practice? start with the eligibility checker to see if your property qualifies, then explore pre-approved plans and financing options.