Unfinished basement: To duplex down or turn into a third unit?

[Benjamin Sussman]

I have a two unit brick building in logan square, Chicago that I’m house hacking. I have a soon to be empty 3bd/1ba first floor unit and an unfinished basement that I can either turn into a separate 2 bed one bath basement unit or I can annex it to the first floor unit and add three bedrooms in the basement.

I ran the numbers and I can make more money in both a long term rental and short term rental scenario renting the unit as a duplexed down unit and I would avoid a lot of excess work required to add the separate basement unit as a legal, conforming ADU.

What makes me nervous about duplexing down is having a less diversified income from this house hack.

If the short term rental has a few bad months or if the tenant in the unit stops paying, I have no other income to rely on in the building while im living in it. Thoughts?