Subdivide existing property and build Duplex?

[Isaac Sullivan]

Hello Folks,

I’m considering subdividing my property and building a duplex. I currently have an existing mortgage of 1650 p/month, 240K balance,  with a property value of $350k. It is on two acres, in which I can subdivide into 2, 1 acre parcels. 

I’m considering building a duplex on the subdivided land. It appears I can build the 2400 sq/ft duplex with land preparation for 240K. The monthly mortgage would be around 1500, with a total monthly income of both units equaling $3000. Now, that doesn’t quite meet the 50% rule, but I’d keep my current property and rent it out for 2000, then move into the other side of the duplex (owner occupied).  I’d bring in an additional 350 on my current home if renting it. 

I’ve been pre-approved for both mortgages as my debt to income shows both properties to be affordable. I suppose I could Put a higher down on the duplex, reducing the mortgage payment. 

Any thoughts on the possible opportunities here to get started?  There is a limited amount of available rentals in this area, so providing additional ones look promising.

Thank you!