Houses with "Extra" Areas

[Trevor J Dammon]

Hey all,

I'm new to the real estate journey and have starting running numbers on duplex/triplex/quadplex in the Minneapolis area. Occasionally I see a description on the MLS that says something like 3rd floor/basement/extra area that could be turned into an additional unit.

For example: https://www.zillow.com/homedet... "Large versatile 3rd level could be 4th bedroom, owners suite, office or 3rd living area."

What sort of things should I be looking for or asking the realtor when analyzing a property with this "extra space".  If anyone has successfully added an extra unit to a property like this I'd love to hear your story!  

Thanks all.  

[James Hamling]

@Trevor J Dammon The first item that most immediately jumps out at me is the item that you probably have the wrong agent. 

The problem is a foundational one many make of assuming and considering that R.E. Agents are just a singular item, which is like saying all Doctors are just Doctors. When someone says they need a Doctor most would immediately say "well, what kind of Doctor?". R.E. Agents are exactly the same; R.E. Agents have areas they know and specialize in, and others they are totally clueless on. 

And keep in mind, just like for Dr's, it takes a R.E. Agent years to specialize and get good in the specialty. And specializing in REI is the rarest of agents, it's like the Brain Surgeons of Real Estate, yet ton's of brokers say to new agents "oh, just start with investors it's "easy"". That is the WORST advice a broker can give anyone, ever. REI is the most intensive, detailed arena of R.E.. Not only do you need to know everything on the transactional side but you also need to know everything on the monetization side; if it's a acquisition for rental you must know all the in's and out's for leasing, which is a heck of a lot in regulation, but also analysis and market factors for that. If a house-hack you need to know the market vectoring, same for a flip.

My point is, if you had the correct R.E. Agent, they would be advising you on all of this, what it means, how it applies, good bad or ugly. What I see happening here is your paying someone thousands to just do some transaction paperwork, who isn't guiding you as to the validity or applicability for the transaction as it relates to your specific goals. 

You need the right tool for the job, a chainsaw makes a horrible hammer, just like a "general" R.E. Agent tends to make a horrible REI Realtor.