Buying 3-Unit House, Counts as Commercial Building? (real estate, apartment)

[Jorge Campbell]

Hello everybody! This question is for the real estate experts out there.

I'm thinking hard about buying my first investment property, and it is a 3-unit large residential house which requires a complete rehab. I was told by a friend that 3 unit properties are commercial properties, and commercial properties will require sprinklers, fire escapes, etc., and conform to commercial building standards such as the IEBC 2009 https://archive.org/details/gov.law.icc.iebc.2009 Is this true?

I was looking at the county real estate website and the house is labeled as:

State Code : Residential
Use Code : THREE FAMILY

[selltheburgh]

The answer is maybe.

Commercial financing is 4 units or more.

To build 3 units or if you do a gut rehab and rebuild everything, you will likely need to follow those guidelines. If you have a good contractor and/or architect, you can get around it with the building being grandfathered. It all depends on how you work it out with zoning and/or bbi. You will need a commercial contractor for a 3+ unit building.

[guy2073]

I am doing a 3 unit building in braddock, you will need a second exit for each unit. I believe the city of pgh requires the use of sprinklers, but it maybe on 4 units or more. If utilities are separated you will have to have a separate power service for any common areas, this includes exterior lights. If you have a common hallway you will need interconnected smoke alarms and exit lights with spot lights. Depending on the extent of the work you may not need a permit on the job, but that does not exclude you from electrical and plumbing inspections.

I do a lot of renovations, most of my customers like duplexes or 5 units or more, the financing is harder on larger buildings and the price per unit tends to be less. it is hard to get a good rent on an attic or basement apartment, that is usually where the third unit is. for a first time rental buyer you maybe better off looking at a duplex. I own a few single family houses that are not money makers, and 2 duplexes that make a good return.