The municipal counter-proposal would bar Illinois HOAs from unreasonably prohibiting ADUs
The municipal counter-proposal would bar Illinois HOAs from unreasonably prohibiting ADUs
2026-09-10 · Illinois · Legislation · Proposed — not yet introduced
What is proposed. The Illinois Municipal League unveiled the REAL Housing Act on May 4, 2026 as its alternative to the Governor's BUILD package. Its own comparison document is dated May 2026.1
A note on status: legislation was described as expected. We could not confirm that bill numbers were filed, so treat this as a published proposal rather than a pending bill.
The framing
REAL is the incentive-based alternative: opt-in overlay districts instead of statewide by-right mandates, a Middle Housing Incentive Fund, a blight-elimination programme with IHDA and DCEO support, TIF authority explicitly affirmed, and a section-by-section preservation of local authority.
It is presented as the proposal that protects local control. That is accurate about municipalities, and it is not the whole picture.
The two provisions that reach associations
1. ADUs. REAL provides that “HOAs/condo associations may not unreasonably prohibit ADUs,” with ADUs otherwise fully subject to local authority.
2. Renter fee protections applied to associations. Its consumer and renter protections — upfront costs excluding first month's rent capped at one month's rent, application fees capped at actual screening cost, and no duplicate or stacked fees — are stated to apply to HOAs and condominium associations, enforced by a private right of action with treble damages and attorney fees.
Why this is the item Illinois boards are least likely to see coming
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