Renting a Basement: How To Solve Zoning Issues?

Question

We are looking into buying SFH's in Atlanta that have a basement, side 'apartment', and/or in-law suite as a creative way to generate rental income while owner occupying the property. After some light research, we have determined that zoning and/or HOA's may pose a problem. If the property is currently zoned as single family residential, do we have to apply for a zoning variance? If the property has an HOA, do we work with them? Should we add someone to our team to help with this like a lawyer specific to zoning? What other resources can we leverage to learn more?

Specifically, we are looking in Marietta/Smyrna areas (Cobb County).

Thanks in advance for any insight!

Corby Goade · Answer

The tone of your email leads me to believe that you think it's just a matter of how you get this done, not if you can, but that's the question you should be asking. Too many factors at play here- you need to know if the unit is allowed according to the zoning code. If it is, but it's not permitted, you'll likely have to do some serious demo in order to get a city inspector to permit it. If it is not, you could apply for a conditional use permit, but the city could just say no. And even if they do say no, some cities don't have the ability or concern to actually enfore code violations, so it doesn't matter. Second- the HOA. Same as above. Also, there may be laws in your state limiting the power of an HOA to control use of privately owned property. In those cases, the HOA might say no, but if the law says you can, you might be able to tell the HOA to pound sand. Regardless of the rules and zoning, it's probably not going to be easy or inexpensive.

Ashwin Metpalli · Answer

@Taylar Caraway Hello, Have you found an answer about how to apply for this zoning variance? I am in metro Atlanta too and learned that my home is zoned as SFH only (though HOA allows for long-term rentals). My plan was to finish the basement and rent it out but looks like I can no longer do it

Wayne Brooks · Answer

It is highly unlikely to get a variance for this in most sfr zoning......they don’t just hand out variances to have a two unit instead of one for no reason. You might check with zoning to see if there is a built exception, set of ground rules.....much better chance than getting a variance.While many people may Have a second kitchen, it doesn’t mean they are legal.....the rent verses no rent charged doesn’t usually matter.

Bettina F. · Answer

My zoning area has "hardship exemptions" for which homeowners can apply. This allows an ADU on the property to house elderly or other family members with special needs. I believe that the square footage is limited to 800 or 900 square feet. The ADUs are allowed kitchens and full baths.Many property owners have ADUs on their property that are no longer needed for family members after the elderly pass away. In practice, there is no use restriction after several years. As long as the neighbors do not complain, no one ever checks on the actual use of the property. When these properties change hands, they are not marketed as having an ADU. We purchased a property like this, and the realtor just told us to keep a low profile.These ADUs make great Airbnb properties!

Bob Floss II · Answer

@Daniel Caraway This type of thing is different for every state, county, and municipality so you'll need to find someone in your area that has dealt with this or hire local counsel.

Taylar Caraway · Answer

Hi Bob, thanks for your response. We are aware that we will have to check with the HOA and also determine what the zoning is. My main question is if the property is not zoned correctly, are there any options to change the zone? We've done some research and found that you can apply for a zone variance but we aren't sure how this works or if anyone has had experience with this, or if this is even a viable option.Regarding the 2nd kitchen, we've actually found a couple properties that already have installed 2nd kitchens in the basement or "in-law suite" but when I check the zoning on these properties, they are listed as single family residential. So I assume this means you can have someone live there but you just can't collect rental income from that person. Right? This is where our idea of applying for a zoning variance comes into play, but we have no idea if this is a reasonable option.If anyone has had any direct experience with this we'd love to hear what you did.

Bob Floss II · Answer

@Daniel Caraway You have two different obstacles. You need to check the HOA declaration and bylaws to see if the rental is allowed. You also need to check with the village or county and find out if the zoning laws allow you to have a rental or inlaw suite. Some places will not even allow a home to have a second kitchen to prevent illegal rentals.