Converting 4-plex into larger duplex

[Andrew Caldieraro]

Has anyone converted a 4-plex into a larger duplex? What kind of headaches do you run across when you do this? I realize there are city and zoning regulations, permits, converting the hvac systems/water meters/electrical panels, etc. Has anyone went through this, and if so, any advice would be great!

[Andrew Caldieraro]

Originally posted by @Peter M.:

@Andrew Caldieraro Why would you do this? Are the numbers that much better? You lose your economies of scale. But to answer your question the upgrades to current code will probably be your biggest problems. Sprinkler systems, thicker roof decking etc.

I would not say the numbers are better.  The reasons for me are:

1.  In the Midwest where I’m at the 1b/1b units will rent for $600.  If two small-medium sized units are converted into a larger 3b/2b unit, the rent will be close to double.

2.  It will be two fewer tenants to deal with, two fewer hvac systems, etc.

3.  The tenants tend to stay for a few years in the larger units, and will most often only stay for a 1-year lease in the smaller units. This equates to more days that the unit will be rented, and it will also eliminate the leasing fee from the PM company every year (if the tenants stay more than one year).

Everyone has a different opinion on this subject.  I often hear people say that they just want more units.  Me, personally, I’d much rather have 20 units that rent for $1200 each than 40 units that rent for $600 each.  Every market is different, but I prefer this method in my market.