Rental conversions in Dallas–Fort Worth

In Dallas, the Board of Adjustment may grant a special exception for a rentable accessory dwelling unit on a single-family lot in any district if it finds the unit will not adversely affect neighboring properties, and it may require an extra off-street parking space.³ When the Dallas Board of Adjustment approves a rentable accessory dwelling unit, the owner must deed-restrict the property to require owner occupancy and register the rental every year with the city's single-family non-owner-occupied rental program.³ Dallas's Board of Adjustment can also approve an additional dwelling unit that will not be rented, and then requires a deed restriction that bars using it as a rental.³

The second path is neighborhood-wide. Dallas neighborhoods can petition for an Accessory Dwelling Unit Overlay, which allows a rentable accessory dwelling unit, subordinate to the main house, on single-family lots inside the overlay; the unit cannot be sold separately from the main building.¹² Inside a Dallas ADU overlay, a detached accessory dwelling unit must have at least 200 square feet and no more than the greater of 700 square feet or 25 percent of the main structure, and it may be only one story.¹² Inside a Dallas ADU overlay, if one unit is rented the owner must live in the main house or the accessory unit during the tenancy, with up to a year's absence allowed with the director's approval, and the rental must be registered in the city's single-family rental program.¹² Inside a Dallas ADU overlay, an accessory dwelling unit generally needs one off-street parking space, but none is required within 1,200 feet of a DART bus or rail stop.¹²

Outside an overlay, the general accessory rules still apply. Outside agricultural districts, Dallas bars renting an accessory structure except as an accessory dwelling unit, and limits any one accessory structure on a single-family lot to 25 percent of the main building's floor area, not counting parking space.³ A single-family lot in a Dallas single-family, duplex or townhouse district may have only one electric service and one meter unless the Board of Adjustment grants a special exception.³ Ask the company to check the lot's zoning and whether a hearing is needed before anyone draws plans.

Fort Worth's zoning ordinance defines an accessory dwelling unit as living quarters in a detached building on the same lot as the main house, used by temporary guests or family members, that are not rented or leased and have no cooking equipment.⁴ In Fort Worth, a habitable accessory building must meet the building code for habitable structures and be no taller than the main house, and in one-family districts it may be used only as an accessory dwelling unit, not as a separate independent residence.¹³ So in a Fort Worth one-family district, a backyard cottage can house family or guests but not a tenant unless the property is rezoned.

Every detached garage in Fort Worth needs a building permit, with zoning limits on location, height and size that depend on the lot's zoning and on whether the building includes habitable space.¹⁴ Fort Worth requires a building permit to enclose a garage for any use other than parking, and a variance from the Zoning Board of Adjustment may be needed because required parking spaces are lost.¹⁴ In Dallas, too, a single-family lot has a parking requirement: Dallas requires one off-street parking space per dwelling unit for a single-family use in single-family, duplex, townhouse and RTN districts, with limited exceptions.³

Fort Worth is direct about it. Fort Worth allows short-term rentals of 1 to 29 days in mixed-use and most form-based, commercial and industrial districts but not in its residential districts (A, AR, B, R1, R2, CR, C, D and UR), and every legal one must register with the city and pay hotel occupancy tax.¹⁶

Dallas's rules are tied up in court. In 2023 Dallas adopted two short-term rental ordinances: Ordinance 32482, which banned short-term rentals in areas zoned single-family residential, and Ordinance 32473, which regulated the rest and set up registration and fees.¹⁷ In July 2025, on rehearing, Texas's Fifth Court of Appeals affirmed a December 2023 temporary injunction that bars Dallas from enforcing both of its 2023 short-term rental ordinances, reversing it only as to one of the five plaintiffs.¹⁷ The appeals court docket for the Dallas short-term rental case shows its July 18, 2025 opinion affirming in part and reversing in part, and a petition for review filed in the Texas Supreme Court on October 16, 2025.¹⁸ Ask the city's Development Services department what applies to your address before you plan on nightly guests.

A landlord who does renovation work on pre-1978 rental housing personally needs both EPA firm and renovator certification; a landlord who hires the work out needs neither, but the firm must be Lead-Safe Certified.¹⁹ Before a renter signs a lease for most pre-1978 housing, federal law requires the landlord to disclose known lead-based paint and hazards, share available records, hand over EPA's Protect Your Family From Lead pamphlet and include a Lead Warning Statement.²⁰ Inside Fort Worth there may be money for the lead work: Fort Worth's Lead-Safe Program offers free lead testing and lead hazard repairs for homes in the city built before 1978 where a child under six lives or spends regular time or a pregnant woman lives, for households at or below 80 percent of area median income; rental properties can qualify if the owner agrees to take part.²¹

The 2021 IRC requires at least one egress door for each dwelling unit, reached by a continuous path that does not pass through a garage, and opening to a public way or a yard or court that leads to one.²² The 2021 IRC requires smoke alarms in each sleeping room, outside each separate sleeping area and on every story including basements, interconnected within each dwelling unit so that one sounding sets off all of them.²² The 2021 IRC requires at least 5/8-inch Type X gypsum board or equivalent between a garage and habitable rooms above it, and does not allow any opening from a garage directly into a sleeping room.²² Ask the company to show on the plans where each alarm goes and how the unit's own door reaches the street.

More than one in four adults 65 and older fall each year.²³ A one-story backyard unit is already easier to live in than an apartment up a garage stair, and Dallas's overlay rules cap ADUs at one story anyway.

For an aging parent, ask for a no-step entry, a curbless shower, wide doors and lighting along the path from the main house. NAHB's Certified Aging-in-Place Specialist (CAPS) credential trains remodelers in home modifications for aging in place.²⁴

Calling this number puts you through, on a recorded line, to one independent company that handles rental conversions in the Dallas–Fort Worth area. The unit, the approvals and the price are worked out between you and that company.

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Check the company and its subcontractors yourself before you sign. Before construction starts on a Texas home, the original contractor must give the owner a written list of the subcontractors and suppliers it plans to use, and an updated list within 15 days of any change, unless the owner waives the list in writing.²⁵ When the owner makes final payment on a Texas residential construction contract, the original contractor must sign and deliver an affidavit stating that the bills for the job have been paid.²⁵ TDLR's License Data Search lists active licenses only and can be searched by license type, license number, name or business name, city, county or ZIP code.²⁶ Check a Texas license