Maximizing rental income in 2 story limestone w/ below grade basement

So I put offer in and it’s been accepted on a 2 family limestone and I’ve been tossing ideas back and forth in my head to the point where I’m overwhelmed. The basement, which doesn’t have a cellar under it, is below grade. The building is 20 x 55 and attached on one side so they’re windows on the side of the basement and in the back. I’ve concluded that maybe it’s best to have a upstairs rental and a parlor floor/garden duplex. Does this sound reasonable or would you take the risk to try and do all floor though rentals, including “fuzzy” garden floor rental? Garden floor has own entrance as well as rear access/entry. . Started to think long term and figured if I wanted to sell this investment later down that a parlor and garden duplex apartment would be good for a potential buyer, along with income suite on top floor. Only thing, I’ve read on this site that best setup is parlor and top floor duplex, and garden rental. I’ve rented my condo before but this will be my first time renting a two family and I want to get it right from the beginning. . Any words will be greatly appreciated. Thanks in advance.

Attention2detail

in Real Estate - Rentals 10 years and 7 months ago

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Attention2detail | 10 years and 7 months ago

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Going to stick with top floor rental with parlor and Basement/duplex. Kitchens and nice big living space on Parlor level. Seems to really be the only safe option. Just for clarity there isn’t a cellar or anything under the ground floor. Going to just leave things the way they are. Thanks for the help everyone.

resident2 | 10 years and 7 months ago

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DO NOT waste your time, money or energy trying to make a legal two family a three family! You are straddling the line between a whole different set of building codes and regulations. The time & money for a couple of thousand more a month in rental income will not justify the lose of all that rent while under construction, or the Real Estate tax re-assessment after your “improvements”, let alone the actual cost of the construction & bureaucracy to get there! Without knowing the neighborhood that it is, or the current architectural style or layout, it is difficult to say what the best use or layout would be for optimal rent.

enew555 | 10 years and 7 months ago

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If you covert to 3 family, you could be opening up a can of worms (Ie new fire code sprinkler). If basement is below grade it might not be legal for a rental. I suggestion you do a through research —– before you start any work….dealing with the Dob will be overwhelming…..JMHO.

bqeresident1 | 10 years and 7 months ago

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I have same potential situation – garden floor rental, duplex above. Anyone know about resale issues when you swap the rental and owner’s duplex without changing the C of O? How big of deal is it if I card shows kitchens on 1st & 2nd floor and they are switched to 2nd and 3rd? thanks

Augustiner | 10 years and 7 months ago

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if you make a garden level rental and combine parlor and top into 1 unit you win a lot of space, because the common hallway will be integrated in the upper apartment.

lmtuzyjcftvgonr | 10 years and 7 months ago

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So you have a basement, garden floor, parlor floor and a top floor (2nd floor) right? If so, in order to maximize your returns, I would suggest a 3 family layout. Unit 1: Garden Floor + Basement (Rec. Space) Duplex Layout Unit 2: Parlor Floor Unit 3: Top Floor (2nd Floor) If this is an investment property, why not shoot for a 3 family CofO, and maximize your returns both rental, and at sale. — MOSFIGUL AKTAR Architectural Designer Certified Construction Manager P: 917.495.6775 F: 718.676.6620 E: Info@AktarGroup.com Web: www.aktargroup.com

dorkofwindsor | 10 years and 7 months ago

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windows on one side in the basement? that is very good (and unusual), and i would investigate further the legitimacy of a full legal apartment down there. But as you noted moving from a two to a three family is financially onerous. In our neighborhood we have nimbys that call out illegal basement apartments regularly, so it can be a roll of the dice when spending that kind of money.

Attention2detail | 10 years and 7 months ago

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Thanks GoodProspect. I think about this about twenty times a day. To reduce cost I may just leave things the way they are, which will be garden and parlor duplex and top floor rental. No need for me to get to emotional about a investment that I won’t be living in. Having the basement as a rental would be good short term but may not be good for long term. Plus the upfront cost of making it legit is sky high. Seems less costly to keep things the way they are and still make a decent return monthly. I’m excited and stressed out at the same time.

GoodProspect | 10 years and 7 months ago

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Since the basement is not totally below grade, look up what the city requirements are in terms of the # of feet that a rental needs to be above grade. When we bought our 2 family we spent a fair amount of money digging out the basement so that it had the requisite number of above-grade feet. Now we have a nice apartment down there, more of it is above grade in the back than in the front but it’s all legit, and it brings good income each month. After having a horrible experience with the nightmarish upstairs neighbor in the last apartment we lived in, there is no way we would live under someone again – even a tenant.