Dividing Duplex into two Parcels

6 Replies

I would love the input of the experienced! 

I have acquired a property zoned as a duplex on a single parcel.  This is two identical 3/1 units sharing a center wall.  What would it take to zone it as two individual parcels.   I want to look into this because I could maximize my investment by selling seperately.  

The zoning officer/person said there was a certain square footage requirement, which we didn't meet, but she said it might still be possible.

Anyone with related experience or has completed such division I am all ears! thanks BP

I would never buy a duplex that has been divided into two parcels unless I could buy both parcels and turn them back into one. Why own only half a duplex? This complicates the matter. Doesn't make sense to me.

We call these 'town homes' and they have additional structural requirements in our area over a simple duplex, such as a fire wall through the attic to the ceiling. Check with your building dept or an informed GC. You will end up with common wall agreements for roof, paint, fence, etc.... much like a condo. Also make sure your water/sewer is individually metered before you start. 

I've heard of duplexes being split via zoning to be sold individually for maximized capital. Although I do not know what needs to be done to complete this properly, I think it's a beneficial exit strategy.

This is a foreclosed property I purchased at a great deal. I plan to rehab, place renters and then sell to an investor. The idea of splitting up each unit has its appeal bc I could sell each unit to an OO rather than just pinning my buyer to an investor.

I'm not convinced it's the best route.

Do most Multifamily investors look for properties who already have renters in place? Would a newly renovated property with tenants entice an investor?

@Marcia Maynard   

@Curtis Bidwell

@Justin Brewster  You will see various opinions but I want tenants in place when I buy.  (I also want to see the screening report to know the quality of tenant.)  This proves the market value and rentability assuming you are at market rent.  

I like to buy where I know the rents are below market.  But with tenants in place i dont start off dealing with vacancies.  You will usually have 1 month before you make a mortgage payment so your rent becomes your 1st month of reserves.  

Originally posted by @Justin Brewster :

This is a foreclosed property I purchased at a great deal. I plan to rehab, place renters and then sell to an investor. The idea of splitting up each unit has its appeal bc I could sell each unit to an OO rather than just pinning my buyer to an investor.

I'm not convinced it's the best route.

Do most Multifamily investors look for properties who already have renters in place? Would a newly renovated property with tenants entice an investor?

@Marcia Maynard  

@Curtis Bidwell

I'm okay buying a multiplex either way. If it is empty, I can usually fill it soon enough. If it is occupied, I work to try to keep the tenants in place. Most will readily adjust to our management style and our rental agreement. Some don't and tend to move on their own. I don't like it when the seller tries to fill units just prior to the sale. They don't have the incentive to vet well because they won't be managing those tenants. I'd prefer to pick my own tenants in that case.

There are investors who want to owner occupy one side of a duplex and rent out the other. There are investors who want to own the whole building and rent out all the units. You will do well by selling to investors. I wouldn't go to the trouble of putting renters in place unless it helps establish the rental value. Some investors are looking for turnkey properties, some are not.

In our market, duplexes sell well, newly renovated or not. There are plenty of buyers.

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