Should I convert a duplex in South Pasadena back to a SFR?

9 Replies

Hi All,

Hope you all can give me some advice.  I recently purchase a duplex in South Pasadena but the zoning is Single Family Resident so the city has no issue with me converting back the unit.

The unit is currently under the grandfather plan which means the building is legally a SFR but not conforming to the currentt laws so I can continue to let it be a duplex or change it to a SFR.

The property needs substantial amount of work estimated around 100k and is 1600 square feet.  I am looking to move my family into the duplex after rehab so comments or suggestions is appreciated. 

Thanks

You should keep the status of the property being a duplex, but make the floorplan livable for your family. Then, when you sell it, you've retained the duplex status. Sounds like once you revert to a SFH, there is no going back. Normally, especially in Pasadena where there isn't rent control, more units equals higher value.

Hi all thanks for your input.  The reason why I am pulling my hair out is because a single family resident are worth more than a duplex in South Pasadena and it seems that if I am going to gut out the property its better if I went that route.  Thoughts?

Converting to SFR is a greater value if looking to flip.

Sounds like you're going to be there for awhile so being richer on paper isn't necessarily helpful. What you can do is renovate both units and rent out one to subsidize the unit you are living in. Schools are fantastic so you'll have no issue finding a tenant. 

In the future you can then have the option to rent out your unit, should you choose to do so, and have a cash flowing income property without rent control. 

I would only be concerned what my house was worth if I needed to borrow against it, or sell it.

Other than that, I wish the appraiser thought it was worth 1$ the day after I closed. What do I care what its worth to anybody else if I am not planning on selling it soon?

If you are flipping it then I would convert to SFR, if you plan to keep it as a long term investment leave it as a duplex and make it livable for you family.

@Simon Qu it's totally dictated by if you want to cash-out or if you want to house hack. 

If you want to house hack, keep it as a duplex and get the long term benefits.

If you want to cash out, find out the highest comps for duplexes and SFR within a mile and find out which one cashes you out with the best ROI, then flip it.

All the best!

sjw