Do you intend to build a new house on some open land? Or do you want to dismantle and renovate an existing structure? If this is the case, have you considered building a duplex? A duplex comprises two homes that share a wall but have separate entrances. There are several advantages to owning one, as you will discover.
Multiple properties on a given plot of land are not the only consideration when constructing a new home. However, there are several advantages to building a duplex for prospective homeowners, like maximizing your property’s profitability and hosting your extended family. Continue reading to discover why you might choose to create a duplex.
5 Benefits of a Duplex Home
1. You can save a huge chunk of money on land
Due to their flexibility, duplexes are more suited for smaller pieces of land than single-family homes. This is especially true on small pieces of land where the second home can be constructed behind the first. Consequently, you will save money on your mainland investment, thereby reducing the total cost of your construction.
Duplexes are often two- or three-story structures is also advantageous. This implies that you are more likely to incorporate as many bathrooms, bedrooms, and entertainment spaces as you like in your tiny home with double lofts without sacrificing outdoor space. For instance, you can have a balcony on the top floor to entertain your family and friends while they enjoy the fresh air.
2. You can use it as an Airbnb
You can potentially generate more money renting the second unit of your duplex through Airbnb or other vacation rental services than you might through a standard one-year lease. Why? Since vacation rentals are for short-term visits, you can charge a higher rate.
Renters from other parts of the country pay a premium to rent homes for a day, week, or month. The best thing is that you only need to take some excellent photographs and name your home on the website. In addition, if you have family visiting, you might limit those days.
However, some regions have extremely stringent regulations, while others are quite permissive. Before renting out your duplex home, you must familiarize yourself with the local legislation.
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3. You can enjoy mortgage benefits
Mortgage lenders often categorize homes as owner-occupied or non-owner-occupied and thus provide more advantageous interest rates to buyers of owner-occupied houses. A mortgage firm views a duplex’s two apartments as a single property. Moreover, if you inhabit one of the apartments, you are eligible for a lower interest rate.
If you intend to rent the second unit, you might be eligible for an even bigger mortgage. When qualifying for a mortgage, many lenders allow you to use a portion of the possible rent in your income. This will make you eligible for more than you would have received otherwise.
4. It is an affordable investment for first-time homebuyers
The rental market in the US has been growing tremendously in recent years, including condos, cooperatives, single-family homes, multi-family residences, townhouses, and duplexes. The latter can be the ideal option for first-time real estate investors, as they offer both inexpensive housing and profitable investment. Notably, a duplex can have the same number of rooms as a single household.
5. It’s an opportunity to learn about the landlord profession
Being a landlord is an excellent side business that can generate passive income. However, there is plenty to learn, including how landlord-tenant regulations work in your state, how to prepare a lease, collect rent money, and screen potential renters. Buying a duplex and living on one side while renting out the other is a great way to begin investing. Why? You reside nearby your rental property. You will view the location daily and be aware of any necessary repairs.
Before you go into the duplex and landlord business, there are a few statistics to consider, such as investigating the local rental rates. When purchasing a duplex, ensure that if just one side is rented, the rent will be sufficient to cover the principal, interest, insurance, and taxes. And if it is financially feasible, you can enjoy the benefit of OPM – other people’s money.
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4 Tips to Consider When Constructing a Duplex Home
1. The ideal location
Having a location to construct a duplex is the most fundamental prerequisite. Your prospective home’s location must be family-friendly and secure.
Additionally, you must examine the soil’s landscape and check that no hazardous chemicals have been deposited there. A level surface guarantees the stability of your home’s foundation, minimizing the need to spend money grading the land.
How is the weather, and what is the accessibility like? As you don’t want your vehicle to become trapped, it would be preferable if the local weather is nice and there is simple access via smooth roads.
You must provide a sufficient budget to cover the expense of the design + build project. Creating a budget helps you avoid overspending and prepares you for the journey ahead.
Consider the architect who will design your ideal home, the materials required, the labor cost, and other extraneous charges while creating your budget. Remember to budget everything on a wider scale to account for unexpected costs.
3. House design
This is the most exciting for creative minds. You can generate various architectural design concepts and cross-compare them to determine the ideal option. During the design phase, you can also select the size of your duplex home. If you are building a home for your family, getting their feedback on how they would like their room to look would be a good idea.
4. Size of the land
The size of your home will be decided by several criteria, including the plot’s size and budget. When maximizing a tiny plot of land, a duplex design built on another seems like the most practical option. Your land’s size will also determine the number of rooms, the proportions of the rooms, and the possible size of the outdoor space.
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The Bottom Line
When considering a duplex, you should always weigh the benefits and negatives to determine if you’re making the right choice. Constructing a duplex home can be an effective way of supplementing your rental income, but it is not always guaranteed.
Alternatively, many duplex owners find it advantageous to live in one unit while renting out the other to carefully screened renters. As a result, it can develop new relationships and evoke a sense of community. Use this guide to learn what you can benefit from duplex homes.