An Accessory Dwelling Unit (ADU) — called an Additional Residential Unit (ARU) in Ontario planning language — is a self-contained home on the same lot as a main house. In London, Ontario they've gone from a niche idea to one of the most practical ways to add rental income, house family, or increase a property's value. This guide covers what you can build, what it costs in 2026, how permitting works, and how to fund it.
Quick answer: Most London homeowners spend $150,000–$350,000+ on a detached ADU once permits, utilities and finishes are included. A property assessment is the only way to get a number you can trust for your lot.
What is an ADU (ARU)?
An ADU is a complete, independent dwelling — its own kitchen, bathroom, and private entrance — sharing a lot with the primary residence. Ontario uses the term ARU; "garden suite," "granny flat," "backyard suite," and "laneway house" all describe the detached version.
The four types of ADU
- Detached standalone units — a separate structure in the backyard. This is our specialty at Kuzyn Builds, with pre-designed models like The Paul, The Maria, and The Henry.
- Interior / basement conversions — turning a basement or attic into a self-contained suite with its own entrance.
- Garage conversions — converting an existing detached garage into a livable, serviced unit.
- Additions — an attached unit that still functions as a fully separate dwelling.
Not sure which fits your lot? Our renovation and build services page breaks down what each path involves.
London, Ontario regulations in 2026
The City of London actively encourages ARUs as part of its housing strategy, and Ontario's Bill 23 (More Homes Built Faster Act) now permits up to three residential units as-of-right on most serviced residential lots — often without additional municipal development charges. Key requirements still apply:
- A maximum total of dwelling units per lot as set by current zoning (commonly up to three, lot-dependent)
- A separate entrance for each unit
- Independent or properly sized utilities (water, sewer, electrical)
- Building permits for every configuration
- A residential rental licence if you intend to rent the unit
Rules change, and the City updates its ARU guidance regularly — always confirm current zoning and servicing for your specific address before committing to a design. (This guide was last reviewed in June 2026.)
How much does an ADU cost in London? (2026 ranges)
Costs vary with configuration, site conditions, and finishes:
| ADU type | Typical 2026 range | |---|---| | Interior / basement conversion | $90,000 – $170,000 | | Garage conversion | $100,000 – $180,000 | | Attached addition | $140,000 – $240,000 | | Detached unit | $150,000 – $350,000+ |
Utility hookups (sewer, water, electrical service upgrades) are usually additional and are the single biggest source of cost variation between lots. One of the reasons we publish fixed starting prices on our ADU models is that homeowners deserve a real number, not a vague "it depends."
Financing and incentives
- Canada Secondary Suite Loan Program — low-interest financing of up to $80,000 for adding a secondary suite (check current federal terms and eligibility).
- HELOC / refinance — many homeowners fund an ADU against existing home equity.
- Construction / draw mortgages — staged financing tied to build milestones.
- City of London ARU incentives — the City has offered grant support for qualifying additional units; amounts and availability change year to year, so confirm what's open before you apply.
An ADU that rents at London market rates can offset a meaningful share of these costs — we cover the income side in our rental-income guide.
The build timeline
A detached ADU typically moves through: property assessment → design → permit application and approval → site servicing → construction → final inspections and occupancy. Permitting is usually the least predictable stage, which is why an experienced local builder who knows London's process is worth more than the lowest quote.
Frequently asked questions
Do I need a permit for an ADU in London? Yes. Every ADU configuration — including basement and garage conversions — requires a building permit, and rented units require a rental licence.
How many units can I have on my lot? Under Bill 23, most serviced London lots allow up to three residential units as-of-right, subject to zoning, lot size, and servicing. Confirm for your specific address.
What's the cheapest type of ADU to build? Interior/basement conversions are usually the lowest cost because the structure already exists — but servicing and egress requirements can narrow the gap with a detached unit.
How long does it take? Plan for several months from design to occupancy, with permitting the main variable.
Getting started
The first step is always a property assessment to confirm what your lot allows and which configuration fits your goals and budget. At Kuzyn Builds we handle everything from design and permitting to construction and final inspection, right here in London, Ontario.