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Recently, I've been watching a few shows on HGTV where homeowners remodel and convert a part of their own into an apartment, then get a tenant and have that rental income pay for some or all of their mortgage. To me, at a high level, it seems like an interesting concept, but I have this feeling that there's much more to it than these shows let on. Assuming, of course, that you owned a home that had the appropriate space available and that it was legal to do, what do you guys think? Could this actually work out, or would this be a sure path to financial ruin and too many headaches?
I'm not sure that it is legal here. I do know that in many places, this was done (Chicago & London come to mind) and done successfully. One of my friends in London lives in such a flat...it's tiny but it is complete for her needs and is cheap enough for her to survive on temp wages.
However, there is the tenant issue which is always iffy. IF you get a good tenant...well, it's great. IF you get a bad tenant, well, then, it is horrid.
There are many people who do this sucessfully in older neighborhoods and in towns like Davidson. I also know of at least one of these in an older area of Monroe. Several garage apartments, etc., still exist in older homes in Dilworth, Elizabeth and Plaza Midwood. It used to be a lot more common than it is now and makes a lot of sense for young singles and couples couples and older people looking to downsizes ("granny flats" they used to be called) Unfortunately, in most areas of Charlotte and surrounding towns, outdated zoning codes and HOA codes require single-family only developments. You would need to check with the city planning departments and your HOA. Do your homework, too, on increased tax liabilities, etc., and on your potential tenants. But I've known several situations which this works in.
OK, you alluded to something I was thinking. I was wondering if such a concept was really more practical in a large city where, first of all, you'd find homes with full basements that would allow for such a conversion, and where such an arrangement would be a better alternative than a standard apartment.
As a renter, I'm thinking, why would I pay a premium price to live in what is essentially someone's basement, and not have all of the amenities that a comparable apartment would have for the same money? As I'm watching these shows, I'm trying to imagine who their tenants would be, as these are people willing forking over 2-3K a month for rent.
OK, you alluded to something I was thinking. I was wondering if such a concept was really more practical in a large city where, first of all, you'd find homes with full basements that would allow for such a conversion, and where such an arrangement would be a better alternative than a standard apartment.
As a renter, I'm thinking, why would I pay a premium price to live in what is essentially someone's basement, and not have all of the amenities that a comparable apartment would have for the same money? As I'm watching these shows, I'm trying to imagine who their tenants would be, as these are people willing forking over 2-3K a month for rent.
The ones I see in Dilworth, etc., rent for 600 or so, less than comparable corporate apartments.
Also, I wouldn't trust many of those shows on Home and Garden network or whatever it is. They prey on the "house lust" of many Americans. It's all very irrational.
Recently, I've been watching a few shows on HGTV where homeowners remodel and convert a part of their own into an apartment, then get a tenant and have that rental income pay for some or all of their mortgage.
That show takes place in Toronto. A city with super high rents and Canadian laws.
I was wondering if the figures were stated in Canadian dollars. A couple spent $45,000 to renovate half of a two-family home, then the realtor came in and told them that they could expect rental income of $4500 - $5500. Seemed highly unlikely.
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