Rental Property Investor · Lynden, Ontario · Member since 2017 · 90 posts · 19 votes
I'm designing a floor plan to renovate an existing house into apartments. I'm looking for advice on how many apartments to make. The house is reasonably close to 3 post secondary schools, so students are a good option but not the only option.
Using a given space, I can do any of the following and make it work:
a) one apartment that has 3 generously sized bedrooms, a full bath, large kitchen & living room & a laundry room
b) 2 one bedroom units each with a full bath & kitchen/living room all generously sized. These 2 units would share a laundry room
c) a one bedroom (as above), and a 2 bedroom with all rooms much smaller than above descriptions. These 2 apts. would share laundry.
What are your opinions? I can envision each of them working in the floor space available. I'm looking for best returns (rents). I've been told a few times, though you can get $1000 for a one bedroom, you're not getting $2000 for a 2 bedroom (at least not here, S. Ontario). Looking for what makes the most sense.
Investor · Binghamton, NY · Member since 2014 · 118 posts · 66 votes
8y
Hey Ralph,
My answer as with most things in RE is- it depends. If you’re looking for cash flow, then I would definitely turn it into a multi family. Whether it would be 2 equal sized units, or one larger than the other should be determined by the total rents that could come in. Go with the one that gives a higher number, and see if you can make an informed decision about what units are in demand in your area.
There are reasons you might want to consider keeping it as a single family though. Most of these deal with your exit strategy. Are you thinking of selling within a few years? If so, you may find that it’s easier selling on the market or as a lease to own.
In short- ask whether cash flow or exit strategy is most important, and let that guide your decision making.