Mayor Zohran Mamdani on Wednesday flipped the switch back on for city-backed financing for accessory dwelling units, the so-called “granny flats,” reviving a stalled pilot program and opening a new application window that runs through June 12, 2026. The move restores city loans and technical support for homeowners who want to convert basements, garages or backyard cottages into legal, income-producing apartments.
As reported by THE CITY, homeowners can apply through June 12, 2026, and City Hall said it hopes to close on a first batch of loans later this year. The announcement gives fresh momentum to the Plus One ADU pilot as officials work to turn recent zoning changes into actual homes without completely rewriting neighborhood character.
How the revived funding works
The Plus One ADU pilot pairs low or no interest city capital loans with state construction grants and can provide up to $395,000 in financing to qualified owners where existing zoning already allows an additional unit, according to NYC HPD. HPD program materials, including a term sheet and FAQ, spell out income limits, which building types qualify and basic design templates that are intended to help projects move from idea to construction with fewer surprises.
Who signed up the first time
The pilot’s first round of outreach drew roughly 2,800 homeowners who said they were interested, the Mayor's Office told reporters, although only a fraction ultimately qualified for financing. As reported by THE CITY, about 25 percent of first-call applicants met the eligibility criteria, with many of those homeowners clustered in Queens, Staten Island and the Bronx.
Where homeowners can check if their house qualifies
HPD’s Plus One ADU portal includes an address-search tool and a set of pre-approved ADU designs so owners can quickly see what types of units are allowed on their property and what layouts are already vetted, the agency says. The site also offers flyers in multiple languages along with a FAQ that walks through income caps, occupancy rules and repair obligations that come with taking program financing.
Why advocates say it's helpful — and limited
City officials and housing advocates say ADUs can create small but steady additions to the housing supply while providing reliable income for homeowners, yet they also note the pilot’s early scale will be modest. The Mayor's Office previously said added funding would let HPD offer financing to roughly 35 homeowners under the pilot, and local reporting has noted that HPD estimated the City of Yes rezoning changes could unlock about 25,000 ADUs over the next 15 years, according to Bronx Times.
How to apply
Homeowners interested in the program are encouraged to review HPD’s Plus One ADU materials, gather documentation of household income and proof that they live in the property and then contact HPD’s Plus One team for help with the application. The current application window runs through June 12, 2026, and city resources are intended to help owners move projects forward without having to puzzle through zoning rules and building codes on their own.
