Inherited home. ADU?

Question

Hey everyone,

I'm absolutely thrilled to be a part of the BiggerPockets community! I recently inherited my mother's house, and I'm excited to kick off my real estate journey with it as a tribute to her. The house is a high ranch single-family home with three bedrooms, a bathroom, living room, and dining room on the first floor, and a finished basement that has a full bathroom, bedroom, and common area. The basement in total is 650 square feet. A family member is currently living upstairs and paying rent while the basement is vacant.

I'd love to hear your ideas on how I could make the best use of the basement space. I'm considering turning it into a separate apartment and would really appreciate any suggestions or advice on how to make that happen.

Lastly, I have been researching HELOCs for possible use as a downpayment for a separate multi-family home. What are your thoughts on using a line of credit for another property today?

Thank you all so much for your help!

Greg B. · Answer

Hello Ty,

Thank you for your advice. I appreciate it.

Ty Coutts · Answer

Hi Greg, welcome to the BiggerPockets community! It’s great that you’re starting your real estate journey with your inherited property. Let’s dive into your questions about maximizing the use of your basement space and using a HELOC for another property. Check local zoning laws and building codes to ensure converting the basement into a separate apartment is permissible. You may need permits for plumbing, electrical, and structural changes.

A HELOC can be a flexible and cost-effective way to access funds for a down payment on another property. By carefully planning and leveraging your resources, you can maximize the potential of your inherited property and strategically use a HELOC to grow your real estate portfolio. Good luck, and feel free to reach out with more questions as you progress on your journey! I'll drop a link to schedule a call down below if you would like to discuss the HELOC situation further, as I am a licensed loan officer.

https://calendly.com/tycoutts