Trying to house hack, but zoning says NO!

[Rob Roy]

Hello!

I'll be stationed in Annapolis, MD soon and have been looking for any property where I could cash flow, while still finding a place that my wife and I will enjoy living in. In this area, there are virtually ZERO multiplexes that are affordable (found a duplex for $650,000 once...). What this area does have though, are a lot of split level houses where the lower level is considered an in-law suite and many have separate outside entrances, a full bath/bedroom and we would put in a kitchenette and permanent door to create a separate unit. Long story short, I've looked at countless houses online, met with a realtor twice and saw over 25 houses in person and finally put an offer on one the other day. The seller chose a higher offer; so I rolled right into putting an offer on house #2, when I thought about the zoning a little more. We had a conversation with the realtor weeks ago and she assured us that the area we are looking in would be "totally fine" to have a basement rental - only historic Annapolis is where you need to have a permit. Well I finally took it upon myself to do my own due diligence and called the zoning office directly for Anne Arundel County. The agent told me that the neighborhood that we are looking at is zoned as R5 and multi-units and such are only allowed in R10/R15 zoned areas (which is essentially the town center and a few other small pockets). According to the zoning agent, the only way to legally split a SFH and rent out one unit is if the lot is >14,000 sq.ft. AND if you live in one of the units (my original plan was to move out after a year and then BRRRR the two units and go do it again two more times while I would be there and in total leave with 6 units in my portfolio). All the properties we have looked at are <10,000 sq.ft. and now I'm not sure what to do. It appears to be near impossible to find a SFH that would rent even close to 1% RTV when we move out and we both don't want to commute 45 minutes to work in order to find a multi-family that would work. A huge reason we took orders to Annapolis in the first place was to live close to that area. Any other suggestions you have would be much appreciated. @Scott Trench I'm trying to practice what you preach, but the man is keeping me down!

Also, I know of a few other people that are renting out their basements full time in the same type of zoned areas in Annapolis.  Are they doing this under the radar or is there something I'm missing?

Thanks!