Turn Your Unused Basement into a Money-Making Rental Property
Do you ever feel bad that you’re not getting much use out of your basement? If your home is like many others along the Wasatch Front, your basement is probably unfinished, and used mainly for storage. But what if you could transform that space, and turn it into a separate, livable area that you could use as a rental property?
We’re here to tell you it’s completely possible to renovate your basement and turn it into a money-making rental unit!
Let's Talk About ADUs
Chances are, you probably know someone who lives in (or has lived in) a basement apartment. Often called mother-in-law apartments, this type of rental property technically falls into the category of an “ADU” - Accessory Dwelling Unit.
ADUs come in many forms. They can be a renovated shed in the backyard, a “tiny home” located on the same property as a traditional single family home, an add-on to an existing home, or a basement renovation (the type we’re going to talk about in this post).
If you live in the Salt Lake City area, you’ve probably heard about ADUs in the news recently. That’s because the city government has loosened the once-strict rules surrounding ADU properties. This was done in an effort to create more affordable housing within the community, while also providing an opportunity for homeowners to create passive income. Now, it’s easier than ever to transform your basement into a separate dwelling, and rent it out to tenants! Read on to learn how.
First Thing First - Make Sure You're Allowed to Have an ADU
Every city has its own zoning laws, so it’s important to make sure that the type of ADU you want to build is legal in your neighborhood before you get started. The good news is, at least one form of ADU (remember, there are several different types) is legal in most neighborhoods; and basement apartments are the most common. To find out for sure, reach out to your city’s planning office. You may even be able to find this information online, without having to wait for a reply.
If you live in Salt Lake City, an ADU can be built within a residential zoning area and the property must already contain a single family home, townhome, or rowhome. The city has a convenient ADU handbook readily available online for homeowners to reference.
No matter where you live, you will need to check to find out if there are any size requirements that may apply to your future ADU. In Salt Lake City, an ADU must not exceed 50% of the home’s total square footage. In other areas, the square footage requirement may be a higher or lower percentage. You will want to have your home professionally measured before renovations begin so you can be 100% sure how much of your basement can legally be converted into a living space.
Next Step: Hire an Architect
Renovating a basement is not for the faint of heart in regular circumstances. Transforming it into an ADU is an even bigger undertaking. A knowledgeable architect will help guide you through the process to make sure everything runs smoothly. They can help you create an aesthetic space, while being mindful of energy usage. If you work with our team at Uncommon Architects, we’ll even come take initial square footage measurements and help file the required paperwork with your city!
In order for an ADU to be a legal, rentable space, it must have a separate entrance from the main home. Hiring an architect is a necessity for this reason. Your architect will provide professional guidance and help you determine the best place to create a separate entrance... without disturbing the underground plumbing system or causing any problems for your property!
Time to Start Designing
After your architect visits your property and takes measurements, they will present you with a few design options. These can range from 2D floor plans to photorealistic 3D renderings, depending on the architectural design firm you work with.
Our team loves creating photorealistic renderings, so that our clients can truly “try on” their space, getting a feeling for what it will look like, before they make any commitments. Together, you and your architect will refine the design until it fits your vision for the space and complies with all local building codes. Once a design is finalized, it’s time to start the renovations!
Hire a Contractor
The next step to completing your ADU is to hire a general contractor who can bring the architectural design to life! When looking for a contractor, we recommend interviewing a few to find a good match with your personality and communication style. You’ll be working closely together for the next several months, so it’s important to find someone you like and trust.
If you need recommendations for amazing contractors in the Salt Lake City area, reach out! We would be happy to refer you to contractors we know, trust, and work with on a regular basis.
Start Renting Out Your Space
Now that your formerly spooky basement has been transformed into a beautiful, well-designed, energy-efficient living space, it’s time to find your tenants! For this part of the journey, we recommend getting in touch with a Realtor who specializes in helping real estate investors. They will have all the connections you need for finding tenants, managing your rental unit, and more.
Get in Touch
Whether you plan to call it a mother-in-law apartment, basement apartment, or ADU, we would love to help you capitalize on your existing space to create a rental property! Not sure if you have the space for an apartment, or how to configure it? A consultation with an architect is a great place to start. Contact us for details!
