I recently put a single family house under contract to use as a rental in Philadelphia, PA. I subsequently learned that this property is zoned I-2. Will this zoning prohibit me from obtaining a rental license or cause me any other trouble in renting the property?
Thanks in advance for any help!
Cant say Ive ever ran into a SFH as an I-2 before. From what it looks like the only residential use is for 'caretaker quarters'. Is there a variance on the property? Was it owner occupies before or a rental unit? What is the zoning around it?
It was owner occupied before. If there was a variance, I do not see it listed on atlas. The entire side of the street is I-2 and consists of multiple row homes while across the street is RM-1. Not sure if I have any other options other than going to L&I to ask them what I can do about it.I have a clause in the agreement of sale stating that the property must be suitable for residential use, so I should be able to get out of the agreement if this goes terribly wrong.
Glad to hear you have that clause. I would call L&I tomorrow morning and give them the addres and ask if you'd be able to use it as a rental property without a variance. I imagine its going to be a no but always best to find out from the source. If they say yes then I would probably go in person to verify.
I was able to call L&I yesterday and they actually said I should be able to get a rental license easily because its a single unit and I will have a certificate of occupancy from the seller. I was not expecting the call to go as well as it did so I was pleasantly surprised. Thanks again for the help!
@Michael Lutes One thing to keep in mind that I have dealt with in the past is when the zoning is incongruent with the actual use, the city can give you a really hard time pulling building permits. I had one we were doing a cosmetic rehab on a single family where the zoning was CMX and they wanted full architects drawings and a whole bunch of other junk that didn't make any sense. They also wanted us to get a commercial building permit which meant it was going to be minimum 8 weeks to turn around.
If you can get away with not getting permits or you aren't planning on doing any work, then it shouldn't be an issue, but if you have a major renovation planned or you think it might need one down the road, then it is something to keep in mind.
@Rich O'Neill That's great to know Rich. Fortunately the property is in decent shape and will only require a couple new appliances, painting and maybe some flooring. Down the road (5+ years) I might consider putting in a second bath but for now I will keep in mind that it could be difficult. The current owner was able to pull permits when he updated the face of the property so I am hoping I can do the same. Thanks for the response!
Another factor to consider will arise if and when you seek financing on this property. You will pretty much be limited to portfolio lenders.