Good morning BP, My name is Alex I own a four family in Elizabeth NJ. I currently have a tenant moving out of a two bedroom apt. That apartment has stairs case going into a room in the basement, the staircase was sealed off by the previous owner to make illegal apt in the basement. I evicted all tenants in the basement prior to closing, now I am thinking of opening that stair way to the basement (a room that was used as an apt that has a separate entrance) and advertising it as added living space to the two bedroom apartment.
***Any thoughts on this? I would not advertise the space in the basement as a bedroom, but rather "livable space".
Asheville, NC · Member since 2017 · 385 posts · 274 votes
7y
I would check with local zoning dept to see how many units you can have in that location. If you can legally rent it as a separate apt I would do that. If not, then add the square footage in with the unit above it and rent it accordingly. It can be a "bonus/storage" room if it's not up to par with the rest of the house. You could also consider putting laundry room down there for all the tenants with a coin operated machine.
Rental Property Investor · Member since 2018 · 26 posts · 9 votes
7y
i agree with Jon but i have rentals in jc and i looked into converting a 2unit into a 3 unit.(unfinished basement) city told me i didnt have enough cieling height for update and permits etc. So i made it a duplex apt. with first flor and installed egress window. i know they allow in jc in law suites in the basement which is technically what mine is with out a kitchen. Also 4 family is not commercial 5 is. now youre talking more regs and rent control. I believe i know it works this way in jc.
Elizabeth, NJ · Member since 2016 · 27 posts · 12 votes
7y
Hi Alex,
I own 2 duplexes in Elizabeth. We did a major reno on the 2nd duplex a few years ago, and at the time I inquired with the city building department about possibly finishing the attic to convert into a legal 3 family. I was told the area is not zoned for 3 family houses so I would need to apply for a variance and appear before the zoning board. A process that is not only time consuming, but may very likely end up costing a few hundred to a few thousand dollars with no guarantee that it would be approved.
Mind you, I'm born and raised in Elizabeth, and I know for a fact the vast majority of duplexes in North Elizabeth have a basement or attic apartment, or both. The city has to be aware of this too, but I guess they choose to turn a blind eye.
The tax free income from an illegal apartment is not worth the potential liability if you ask me. That being said, you can absolutely advertise the bonus basement or attic space with the existing 1st floor unit. Personally, I would take the extra precaution to ensure there are 2 proper exits, either 2 doors, or 1 door and an egress window, etc. Storage and laundry would be another way to monetize it as well.
Another tidbit you may find useful, when I met with the inspector for my CO, they mentioned that in Elizabeth you are allowed to have bedrooms, but no kitchen, in the attic. And you can have a kitchen, but no bedrooms, in the basement.