How Gen X Investors Are Diversifying with Build-to-Rent and ADUs in Maryland
Gen X investors in Maryland are taking a strategic turn toward build-to-rent developments and ADUs—accessory dwelling units—to diversify their real estate portfolios. An ADU is a smaller, independent dwelling (such as a tiny home)—with its own kitchen, bathroom, and entrance—constructed on the same lot as an owner-occupied primary home. These models are helping Gen X investors generate stable rental income while growing property values.
Why Build-to-Rent Appeals to Gen X in Maryland
Build-to-rent communities feature single-family homes tailored for long-term renters, offering modern amenities and minimal maintenance. For Gen X investors, these provide dependable cash flow and reduced vacancy risk—especially attractive near high-demand markets like the D.C. and Baltimore metro areas.
ADUs as a Smart and Localized Investment
In Montgomery County, ADUs are allowed by-right following zoning updates like ZTA 19-01 (effective December 2019), which eased restrictions on detached and attached units . Detached ADUs must be the smallest of: 10% of the lot area, 50% of the main dwelling’s footprint, or 1,200 sq ft; setbacks and height limits also apply. Building and licensing go through DHCA and DPS, with parking requirements waived within one mile of transit and one spot otherwise .
In contrast, Prince George’s County currently prohibits ADUs entirely, though policymakers are exploring changes to align with “Missing Middle” housing strategies .
Balancing Risk with Smart Diversification
By combining build-to-rent projects with ADUs in counties like Montgomery, Gen X investors can balance stability and flexibility: build-to-rent offers predictable returns, while ADUs offer adaptability and affordability. The contrast with Prince George’s County—where ADUs are not yet allowed—highlights the importance of choosing jurisdictions with supportive zoning.
The Bottom Line
Gen X investors in Maryland are redefining diversification: build-to-rent ensures steady rental income, and ADUs—where allowed, like in Montgomery County—offer modular investment opportunities. This dual approach supports long-term wealth while adapting to evolving housing policy and local demand.
