Home prices keep going up and they are becoming harder to afford. With new government legislation comes the ability that allows you to add a second unit to your home. Should you?
Table of Contents - Benefits of Converting Your Single Family Home Into A Duplex
What is a duplex?
As the name might tell you, a single-family home is one that is made or designed in such a way as to accommodate one family. A duplex, on the other hand, is a home that, within one building, is designed for two families to reside in. The two sections are usually detached from each other and may require some remodelling and redesigning on your part.
Making payments easier
Converting your home into a duplex will allow you to go from one unit to two. By choosing to live in one part of the house, and renting the other, you still maintain ownership of the house, but, you will be getting rental income from your tenants, and it will be easier for you to pay the mortgage. For example, if your monthly mortgage payment is 1500 dollars, you convert your home into a duplex and rent out the other portion for 800 dollars, then all you need to come up with is 700 dollars for your monthly mortgage payment.
A good starter home
From the perspective of a family person, if you have children, turning your home into a duplex is a great idea! Once your children grow up, they might be looking for some independence of their own. In such a situation you can easily rent the other, attached or detached part of your house to them. Not only will this be a good starter home for your kids, but it will also help you keep an eye on them. Also, if you have elderly family members, you can rent out half your house to them and keep an eye on them and be there for their support.
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Legal Two Units
Once you legally convert your home into a duplex, you will have two units instead of one. Depending on the area that you live in, this could significantly add to the real estate value of your house as well. If you decide to sell your home, you should be able to sell it at a higher price if it’s a legal duplex, which is an excellent way to make money! You can still convert to two units and have it not be legal, but you must speak with your local municipality to ensure there are no issues with this. If the unit is not legal, you cannot sell it as a two-unit property, therefor demanding a lower sales price.
Make More Money
To make money from your home, converting it into a duplex may be a great solution. Some properties need very little cash to separate the units, while others may need a complete renovation. Depending on the intensity of the conversion this process may or may not make sense. However, if the financials are there, then a duplex property commands more rent than a single-family home which will provide you with stronger cash flow and a legal duplex will always sell more than a two-unit non-conforming property.
Why Duplex Conversions Are A SMART Real Estate Investing Strategy
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