ADU rules in Lake Oswego

A detached backyard ADU is allowed outright as an accessory use. LOC 50.03.004.1.b.vi(1) lets an ADU be created "as an accessory structure on the same lot with an existing dwelling," and the Residential Districts Use Table marks "Accessory dwelling unit" with an A (expressly allowed accessory use) in every residential zone: R-15, R-10, R-7.5, R-6, R-5, R-DD, R-W, R-3, R-2 and R-0. Only one additional unit is allowed per lot. In the R-5, R-3, R-2 and R-0 zones the ADU must be paired with a detached single-family dwelling, and in R-15, R-10, R-7.5, R-6 and R-DD it is capped at one per lot. A detached ADU does not get the reduced accessory-structure setbacks in LOC 50.03.004.2.b, which expressly exclude "accessory structures used as accessory dwelling units," so the full setbacks of the base zone apply unless a minor variance is granted.

The same section allows an ADU "by conversion of existing floor area" or "by means of an addition," so basement, attic, garage and other internal conversions and attached additions are treated identically to a detached unit. Garage floor area counts as existing floor area that may be converted, but a unit built on top of a garage is treated as a detached structure rather than a conversion. For an internal conversion the ADU's required separate entrance may not be placed on the front facade of the existing house, and no variance to that limitation is permitted. Public services (water, sewer and stormwater) must serve both dwelling units.

The headline cap is flat: 800 sq. ft. of gross floor area, with no percent-of-primary-dwelling test and no lot-size sliding scale. Conversions get a modest bonus: where a portion of a dwelling that existed as of August 2, 2018 is converted, up to 200 sq. ft. of circulation areas (halls, stairs and the like), chimneys and heating and ventilation systems is excluded from the gross floor area calculation, so an 800 sq. ft. conversion can occupy up to about 1,000 sq. ft. of the house. A detached ADU has to clear the accessory-structure rules too. Its height is limited to the lesser of 24 ft. and the height of the roof form of the primary structure in R-15, R-10, R-7.5, R-6, R-5, R-3, R-2 and R-0 (28 ft. in R-DD), and in R-15, R-10, R-7.5 and R-6 an accessory structure taller than 18 ft. is capped at 600 sq. ft. and can never exceed the square footage of the main house's footprint. Finally, the ADU's floor area counts toward the site's maximum floor area for the zone, except that habitable area in a detached accessory structure is exempt up to 200 sq. ft. on lots of 10,000 sq. ft. or less and up to 400 sq. ft. on larger lots.

Lake Oswego repealed its owner-occupancy mandate. Until 2020 LOC 50.03.004.1.b.vi(1)(f) required that "One unit shall be owner-occupied/the principal residence of the property owner" and that the owner record a declaration of restrictive use in the county deed records before a building permit could issue. Ordinance 2832 (enacted January 7, 2020, effective February 6, 2020, LU 19-0033) struck that subsection outright and re-lettered the standards, and the current codified text (through June 16, 2026) contains no occupancy condition at all. The repeal tracks ORS 197A.425(1)(b)(B) (formerly ORS 197.312(6), from HB 2001 in 2019), under which "reasonable local regulations relating to siting and design" may not include owner-occupancy requirements. One narrow exception survives and is expressly preserved by ORS 197A.425(2): if the ADU or the main house is operated as a short-term rental, LOC 50.03.004.1.b.ii(8)(a) requires the owner of the lot to maintain their primary residence on that lot.

The old requirement that "the site is large enough to allow one off-street parking space for the accessory dwelling unit in addition to the required parking for the primary dwelling" was struck by Ordinance 2832 (effective February 6, 2020), the same amendment that removed owner occupancy. Lake Oswego then rewrote LOC 50.06.002 through Ordinance 2949 (December 17, 2024) so that the parking section regulates maximums only: Table 50.06.002-2 is titled Maximum On-Site Surface Parking Regulations and lists "Single-family dwelling, accessory dwelling unit, and middle housing" as "No Max" in both the transit-corridor and remaining-area columns. There is no minimum-parking table anywhere in LOC 50.06.002. The city's own April 2026 ADU Permitting and Process Guide says it plainly: "While parking is not required for an ADU, it is sometimes helpful to have a parking space directly serving the dwelling." ORS 197A.425(1)(b)(B) independently bars requiring additional off-street parking as a condition of ADU approval. If you do add a driveway, a street opening permit is required for the work in the right of way.

An ADU is ministerial development, decided by the City Manager with no neighborhood meeting, no public notice and no hearing. LOC 50.07.003.13.a.ii(1) and (2) list construction or exterior modification of an accessory dwelling unit as a ministerial development type, and Table 50.07.001-1 shows ministerial development as a City Manager decision with none of those procedural steps. The permit itself is a building permit (plus electrical, plumbing and mechanical trade permits) submitted through the state Accela e-permitting portal, with tree protection and erosion control review folded in. One extra step applies: LOC 50.07.003.1.e.i(2)(a) requires a pre-application conference before the building permit is issued for any ADU that is not a conversion of existing floor area, which includes additions and any detached structure, and the city schedules those on Thursday afternoons. The ministerial classification drops away and the project becomes a minor development (development review, with notice and a possible hearing) if it is processed through residential infill design review, or if the site is in a Sensitive Lands RP, RC or HBA area, a Historic District, a designated historic landmark, a design district or the Greenway Management Overlay.

Nothing in LOC 50.03.004.1.b.vi conditions or limits renting an ADU on a normal lease, and there is no minimum lease term, no cap on the number of rented ADUs and no owner-occupancy test for ordinary tenancy. Short-term rental is treated as a Type C home occupation: LOC 50.03.004.1.b.ii defines Type C as "a short-term rental, as defined in LOC 50.10.003.2," LOC 50.10.003.2 defines short-term rental lodging as offering space on a lot containing a single-family detached dwelling to paying guests for periods of 30 days or less, and LOC 50.03.004.1.b.ii(8)(a) requires that "a person who owns a lot containing a short-term rental (primary or secondary dwelling unit) must maintain their primary residence on the lot," though the owner need not be present during a stay. The city's Finance Department confirms that a short-term rental "may be located within the house or in an approved accessory dwelling unit on the same lot"; the Home Occupation Business License costs $100 for a new application, runs one year, and registers the owner for the 6 percent transient lodging tax. Note the trade-off with fees: the city will waive system development charges for an ADU only if the owner records a covenant promising not to use the ADU or any other structure on the property as a short-term rental for 10 years. ORS 197A.425(2) expressly lets Oregon cities impose owner-occupancy and parking conditions on vacation occupancies, so the primary-residence rule for short-term rentals is not preempted.