For years, one of the biggest barriers to ADU investment was the owner-occupancy requirement — the rule that required the property owner to live on-site, either in the main house or the ADU. HB 1337 changed that.
What Changed
Before HB 1337
- Owner must live in either the primary home or the ADU
- Annual affidavit required to prove residency
- Investors couldn't build ADUs and rent both units
- Complicated exceptions for illness, death, or unforeseeable events
After HB 1337 (Effective July 1, 2025)
- No owner-occupancy requirement — owner does not need to live on-site
- No more annual affidavits
- Owner can rent both the main home and the ADU(s) independently
- Opens ADU investment to non-resident property owners
Source: RCW 36.70A.681(1)(b)
Seattle Got Here First
Seattle eliminated owner-occupancy for ADUs back in 2019 via Council Bill 119544 (Ordinance 125791) — years before HB 1337 made it the law statewide. Seattle homeowners and investors have been able to build and rent ADUs without living on-site since then.
HB 1337 simply locks that policy in permanently and extends it to every Washington jurisdiction that hadn't already adopted it.
Source: CB 119544 (Ordinance 125791), RCW 36.70A.681(1)(b)
Current Status in Seattle & King County
Seattle
No owner-occupancy requirement. Removed in 2019 under SMC 23.44.041 / 23.44.025 and reinforced by HB 1337. You can build and rent both your home and ADU(s) without living on the property.
Practical reality: Seattle has operated without an owner-occupancy mandate for years — this is settled policy, not a pending change.
King County
Unincorporated King County (KCC Title 21A) has removed owner-occupancy requirements in line with HB 1337. No on-site residency is required to build or rent an ADU.
State backup: Even where local code lags, state standards (RCW 36.70A.535) automatically apply and do not include owner-occupancy requirements.
What This Means For You
Homeowners Living On-Site
Nothing changes for you — you can still build an ADU and live in your main home (or the ADU). The difference is you're no longer required to. If you ever move, you can rent both units without any legal complications.
Real Estate Investors
This is a game-changer. You can now purchase a property, build one or two ADUs, and rent all units — without ever living on-site. This significantly improves the investment math for rental properties in Seattle and King County.
Homeowners Planning to Move
You can build an ADU now, enjoy the rental income while you live there, and continue renting both units if you decide to move. No need to sell or deconstruct the ADU.
Ready to run the numbers? See our ADU cost breakdown or pricing page to understand the full investment. Then get a free feasibility study to confirm what's possible on your property.
Important Caveats
HOA CC&Rs may still require owner occupancy in some communities — covenant review is recommended.
Short-term rental restrictions are separate from owner-occupancy rules. Cities can still regulate Airbnb/VRBO.
Mortgage requirements may have their own occupancy stipulations independent of local law.
Insurance coverage may differ for non-owner-occupied rental properties.
Last updated: March 2026. Not legal advice. Verify current regulations with your local planning department.
Ready to Explore ADU Investment?
Get a free feasibility report to see what's possible on your property — or a property you're considering.
Book Free WalkthroughPrefer to call? (206) 222-2898
