Can a Landlord live in the Basement/Cellar of a rental property?

[Soyini Grandison-Tracey]

My husband and I have a 3 family property in Bronx, NY and it also has a cellar. The correct definition we were told is a cellar because more than 50% of it is below street level; however, it has 8 feet high ceilings, kitchen, three quarter bathroom and more than enough space to create a bedroom. We have asked some Realtors who say no we can't live in the cellar because it is below street level and some say yes because we are not charging for it. Does anyone know what the rules are?