Most people have heard of a mother-in-law suite, but did you know that homeowners are now turning these into income units? Its name comes from the fact that these units were traditionally designed to house aging family members or guests. However, for homes with a mother-in-law suite, this is a valuable living space. That said, if you are looking to add one to an existing home, the cost could prove significant.
Regardless, owners must weigh the benefits and drawbacks before proceeding with renting or adding a mother-in-law suite. So, join us below as we explain how owners are cashing in on homes with a mother-in-law suite.
What is a Mother-in-law Suite?
Generally speaking, a mother-in-law suite is a separate space within a home designated for the long-term stay of one or more family members. Thus, allowing multiple generations of family to live together while still maintaining a level of privacy and independence. That said, these areas usually include a private entrance, bedroom, full bath, living space, and either a full kitchen or kitchenette. Also, it is important to note that an in-law suite does not extend or add square footage to the home. Instead, it is built within the existing structure, with garage and basement conversions being the most common.
Is Renting Your Mother-In-Law Suite a Good Choice for You?
Homes with a mother-in-law suite are a great alternative to the high cost of live-in senior care facilities. But when that space is not occupied by a family member, renting it out is a worthwhile option for some property owners. After all, do not let the label fool you; an in-law suite is typically set up as a fully equipped apartment – just within an existing structure.
That said, owners have many circumstances to evaluate before deciding if renting this space in their home is the right choice. For example, if your home does not already have an in-law suite, adding one is expensive. On average, the cost to add these rooms to an existing attic, garage, or basement could cost anywhere between $15,000 to $60,000.
However, adding a mother-in-law suite increases the property’s value and appeals to future buyers. Plus, these renovations offer the chance for steady income through vacation or long-term rentals. These rental options fill a need for tenants looking for affordable housing or locations in certain areas where traditional apartment homes are scarce. Let’s review some of the benefits, negatives, and considerations every property owner should weigh before deciding what is right for them.
The Benefits of Renting a Mother-in-Law Suite
- Adding a mother-in-law suite to your home increases both the overall home and rental value
- It can provide additional monthly income and can partially subsidize your mortgage payment
- If you indeed use it as a suite for family members, they’ll still have their independence, and you’ll have your freedom. Most suites have their private entrance to the home. Even if you choose to rent to non-family members, the privacy available is still a benefit.
- Furnished in-law suites can double as short-term rentals on sites such as Airbnb or VRBO for owners unwilling to commit to a longer lease term.
Cons of Renting a Mother-in-law Suite in Your Home
- Since the unit is a part of the existing home, owners must accept being in close quarters with tenants.
- Profits in your local market may not always outweigh the cost to build
- Renting out a mother-in-law unit may affect your homeowner insurance policy. So, talk with your insurance agent to see what coverages you may need.
- Renting a room still carries the same landlord responsibilities as renting a whole home.
- You will need to purchase tenant screening software. Not doing so can result in problem tenants leading to a costly eviction process.
- Owners must stay up to date on all state zoning and occupancy laws. Additionally, they need to go through the process of obtaining and maintaining the necessary licensing.
PA Licensing Requirements for Homes with a Mother-in-law Suite
- Obtain a Pennsylvania Dwelling License if you just intend to rent a room. If you rent out the entire property to multiple tenants, you will need to secure a rental license.
- Owners must ensure the property is rentable. Therefore, this includes getting an inspection, a certificate of occupancy, and zoning approval. Keep in mind, skipping this step could result in fines or charges.
- Any PA rental space must adhere to all Pennsylvania Health and Safety codes. So, do your research and fix anything found in the inspection that could count as a violation.
Tips for Renting a Mother-in-Law Suite in Pennsylvania
Once the in-law unit receives approval from the state and is ready to go, it is time to find a tenant. Check out these tips for navigating the rental process below –
- Marketing – A picture is worth a thousand words. So, schedule a photoshoot for quality marketing photos. Then, list the unit for rent on all local and national sites such as Zillow, Apartments.com, Facebook groups, and other available sites. The more exposure, the quicker it will rent.
- Tenant Screening – Experian is an excellent credit screening service for landlords, though there are plenty of others from which to choose. Screening is the owner’s best and first defense against problem tenants. So, a thorough screening process should include rental history, proof of income, credit check, plus a criminal and eviction background check.
- Lease Agreement – The best way to be sure all of your bases are legally covered is to have a real estate lawyer or property management company create a lease agreement for you.
- Collect Funds – Once screening is complete, tenant approved, and the lease is signed, it is time to collect funds. This includes the security deposit, first month’s rent, and any other applicable fees. Additional fees may include pet fees and a pet deposit. Then, schedule the tenant to move in based on the signed lease start date.
The Best Way to Maximize Your Rental’s Potential
Whether just starting in the rental industry or a seasoned investor, one of the best ways to be successful is to hire a professional property manager. As a landlord, owners are responsible for every aspect of their tenant’s experience. For some, this can seem like another full-time job.
That said, hiring a rental property management company means leaving the day-to-day operations to the experts. At Bay Property Management Group, our dedicated team handles the entire rental process. Including, everything from taking professional-quality photos to coordinating ongoing maintenance needs.
So, if you are a landlord in Southern Pennsylvania, Central Maryland, Washington DC, or Northern Virginia looking for more tips and advice for your rental property, Bay Property Management Group can help! Contact us for a free, no-obligation rental property analysis!