Durham Seeks Managing Contractor for New Loan Program

Accessory dwelling units, often called granny flats or in-law suites, are becoming increasingly popular across the country, including in Durham. Thanks to recent changes in the city’s planning ordinances, it is now easier for homeowners to build these smaller units on their property. However, financing remains a significant hurdle for many who want to contribute to addressing the city’s housing needs.

To help overcome this challenge, the city of Durham has introduced the Durham Affordable Accessory Dwelling Unit Loan Pilot Program – a $1.75 million initiative aimed at providing financial and technical assistance for homeowners interested in constructing ADUs on their single-family lots. The program is part of Forever Home, Durham, a $160 million public-private initiative that uses voter-approved and city funds to build homes, renovate properties, and provide essential services for low-to-moderate income residents. Forever Home, Durham is funded by the 2019 $95 million affordable-housing bond and $65 million in existing city and federal funds.

“ADUs offer a flexible, cost-effective solution to add housing units without requiring new land development,” said Reginald J. Johnson, director of the city’s Community Development Department. “Part of our Forever Home, Durham program is aimed at providing more affordable housing in Durham, and this program is an innovative strategy to help homeowners build ADUs on their own property and, at the same time, help low-to-moderate income residents find affordable housing in the city.”

Seeking a Program Contractor

The city has issued a request for proposals to select a contractor who will manage the program from start to finish. The selected contractor will handle outreach, application processing, loan administration, coordination with financial institutions, and compliance with city regulations.

Proposals must be submitted by May 16, no later than 3 p.m. EST. After a 30-day evaluation period, the city plans to select a vendor and initiate the program by early summer. The RFP, which includes a detailed program description and contract award schedule, is available on the city’s Bid Opportunities & Awards webpage.

By expanding opportunities for homeowners to build ADUs, the city aims to create jobs, spur economic growth, and ensure long-term benefits for the Durham community.