This morning I walked through a house with a few investors who focus primarily on ‘Fix n Flip’ investments. The house was priced seemingly low, but the property had some serious maintenance requirements. The saving grace of this deal was the homes design as it was a 4-level split with a door connecting from the garage to the 2 bottom levels while the main & upper floors could use the main entrance.
If you think of it from a creative perspective, this 2,400 SF (total) house was actually 2 homes in one!
The homes layout allowed the original owners to walk away with 288,000 for their dilapidated property while the renovators were happy to sink the extra 20-40 grand it would take to repair the deferred maintenance on this home, as they new they could still make money! Below I’ve listed important aspects of your homes layout that would make your house perfect for a cheap basement suite reno!
2 Entrances: Does your home have a back door? or even better a door directly into the basement? A personal entrance is the first step to a quality basement suite. Even if you have a mud room with 2 entrances, 1 leading down stairs & 1 leading to your main house, that area can be blocked off with a door & used only by the renters.
2 Furnaces: For your basement to legally qualify as a suite you need to have a secondary furnace (one heating upstairs the other heating the basement). This is an expensive renovation and it can cost anywhere from 10 – 15 thousand dollars. If you are unwilling to pay this expense you can always risk a illegal basement suite, or not create a full kitchen in the basement but rather kitchenettes for the tenants. By having kitchenettes the renters are actually not defined as living in a basement ‘suite’ but as roommates.
Windows: Each sleeping space needs to have at least one window in it to fit with government safety regulations. On top of that, Alberta has decided that the area of basement suite windows needs to be greater than 3.57 feet.
Plumbing: Do you have capped plumbing in your basement? This is important as plumbing is fairly cheap unless ground needs to be broken to install extra plumbing attachments. A way to cheaply install new plumbing if you’re creating a new bathroom is to do the plumbing above the concrete level then build a wooden box above it, creating a small step before the bathroom begins.
Odds your house is perfectly fitted for a basement suite are low; although in my experience, if even a few of these needed improvements are in place you’re in a good position! My last word of advice is to understand your rights and your tenants rights. If you’re living in the house while maintaining the tenants the Alberta Tenancy Act does not apply to you, but if you do not reside in the house, I suggest reading the Act to better understand the type of relationship you must maintain with your tenants.
If you have any questions please get in touch!