In-law suite house hack??

13 Replies

I'm looking at purchasing my first property as a house hack. Where I live in Rhode Island the amount of multi families are limited, but quite a few house have in-law suites. I found a nice 3/2 that only needs a little tlc and has an in-law suite, plus I can owner finance this deal. Before I move any further on this deal, I was just wondering if there are any laws that will prevent me from living in the in-law suite and renting out the main house?

Thanks in advance

None that I'm aware of, unless there is a local zoning ordinance prohibiting renting of the property .

From a lending perspective (assuming you're looking to finance as owner occupied), if you're living in the in-law suite then you are occupying and complying with the requirement. It'd be no different than buying a home and renting rooms as a roommate. The only extra thing to think about in this situation is I assume utilities aren't separately metered, so I'd account for that in your DD and cover those yourself. So just make sure that with you paying utilities and common area landscaping/snow the numbers make sense.

Edit: I noticed you mentioned owner finance, so the lending issue is basically a moot point, so just verify the local zoning...though I doubt there will be an issue there unless there is some very specific ordinance locally preventing it.

Matt is correct. If you live in your home, nothing prevents you from living in the in-law suite and renting out the rest. Only caveat is that if/when you sell, the lender cannot take the rent into account for valuation/appraisal purposes, since it's technically not 2 units. An agent cannot also legally market the property as 2 units.

Hope this helps,


@Bill Campbell   you would not be able to rent the in law and the main house that after you move out that would be making it an illegal two family.  You are technically renting part of your house when you are living in the in law and renting the main house area, it is like renting rooms.   If you move out you are renting two units. You will also have to sort out utilities since it is unlikely they will be separate.   Addresses will be a issue if you live in the inlaw, you will need to have one address and one mailbox.   Not sure how North Kingstown is on enforcement but be careful about how you do this and make sure your unit complies with local ordinances. Some areas you can't have a stove in an in-law.   You also should make sure your inlaw has egress even though it isn't a legal two family. You want to be safe yourself in the event of a fire.

Nope, you can't rent the in-law suite after you move out. Not only with your homeowner insurance change, but it's illegal zoning. Colleen is totally right on that point.


MIL suites cannot have stoves. This renders them separate dwelling units. Only one dwelling unit is allowed in single-family. Your city should have a definition of a family which usually is along the lines of six or fewer related or unrelated individuals in a single housekeeping unit. This means that they share the common areas such as a kitchen. A MIL suite is where the "mother"-in-law sleeps, not lives full time. So check the zoning to see if it is SF, two family, or more. This is not a limitation on rentals, its a limitation on density.

@Kyle Kingma Thank you for the response and I'm going to look into the zoning of the house.  If it is a single family zoning, I'm looking into legally changing the zoning to a mulit family.  Hopefully fixing most of the issues like the stove and will still make the numbers work on the house.  

I recently purchased a single family home and built an inlaw apt onto it (obviously not an investment move) my town made me put a deed restriction on the property stating that it is an inlaw apt and not to be rented out or sold as a two family. Obviously you are in a different state never mind town so rules could certainly be different. And you are looking to rent the actual house not the suite. But I would certainly look into it if you are worried about breaking rules. All that being said, I am very impressed with the thought process and your willing to sacrifice to get ahead. Keep thinking out side of the box and you'll be successful.

Sidenote. My inlaw has a stove. Different areas, different rules. In my town you can have 30 kitchens in the house. It's all about interior access here. That's what defines inlaw or multi family.

@Bill Campbell look at the zoning, if the zoning is single family they are unlikely to bend on making it a legal two family. If it is a mixed use or higher density you may be able to do it.   The zoning maps should be on the town website.  They don't change the zoning, they allow the unit be converted if the zoning permits or they allow a non-conforming use but they don't have to allow the conversion or non-conforming use.   I have units in South Kingstown  and  because of the student population there are illegal units out there I am sure. I would not want to be those owners though when there is an issue.  That being said by the time you move out your rental could be a good rental as a single family.  I have received calls on one house looking for the kind of setup you would have.  New Englanders love those family  multi-generational households. Might not be as much rent though.

I'm just reading this now but thought of another question.  I know you could not use the current rental income when looking for your next property but could the bank use future rental income to offset the debt to income? Also if you cannot use the rental money as income how does that work for tax purposes?