Duplex with Two Bonus Apartments. How do I make the most of it?

Question

I am looking into a two family home that has two "bonus apartments", essentially making it a four family home on a two family lot. Each unit has its own separate entrance but the home has a two family CO and is only zoned for two family. I have been seeing a lot of similar postings stating that there is room for an extra unit or a "bonus unit". How would someone take advantage of a theoretical "bonus unit"? How would the extra unit get mail? Could it be sub metered? Any and all advice is appreciated.

Todd Dexheimer · Answer

If these are not approved by the city, I would be careful. If anything happens, it will fall on you personally. Your insurance company could also cancel you policy and deny claims. The best thing to do would be to try to get it approved through zoning for the extra units. If that doesn't work, I would turn the "bonus units" into livable space for the legal units

J.R. Coffin · Answer

If you go into the assessors database and go to the parcel look-up you should be able to see how the property was listed in the past. Two-family or Multifamily. I feel that its unlikely that you would be able to build 4 units if it previously wasn't zoned as a 4. But if that's actually the case, you'll likely need a variance to change occupancy. Let me know if you need help with the plans. I've converted a number of similar units.

If its only zoned as a two - a few ideas come to mind. Short term rental is the obvious choice. There are plenty of airbnb property managers that would probably love to help you with that as well. Or you could potentially add the two bonus apartments onto one or both of the existing apartments. Would probably take a bit of redesigning the layout, but you're increasing your rent-able square footage when it comes to the sale.

Danny Randazzo · Answer

@Rick DiAgostino you might be able to rent the bonus apartments but as @Frank Procopio said, you need to check local laws/codes. You probably won't be able to sell the property in the future to include the bonus apartment value unless you get it zoned

Kevin Sobilo · Answer

If you can't overcome the zoning issue, then perhaps connect these bonus spaces to the existing units to create larger rooms and then rent by the room rather than by the unit.

Renting by the room will require more management effort, but it could be worthwhile in a situation like this.

Edward Liu · Answer

I don't believe you can rent them out legally nor should you try due to liability.  Your insurance company will only cover it as a duplex.  If you rent out more than 2 units and something goes wrong, your insurance will not cover your losses.

Frank Procopio · Answer

You would need to check with the local codes office. One of my first properties was a brick three unit. All three floors the same layout. Come to find out the previous owner changed it to a two family to cheat on his taxes. The city will not allow me to rent the third unit and told me if I did they would impose fines and even arrest me. The unit has sat vacant the last ten years.