Here’s why you should consider a property with a rental or in-law suite.
- Multigenerational Living is On The Rise
With increased housing prices and the increased cost of living, the reality is that more and more people are choosing multigenerational living.
Other factors have contributed to the rise in multigenerational homes, including how the pandemic has impacted our trust in long-term care homes. Many people were disappointed in how long-term care homes managed the pandemic and felt their loved ones were in danger. By living in homes equipped for multigenerational living, long-term care homes can generally be avoided if willing caretakers are present.
While it is very common for multigenerational families to cohabitate in homes not equipped with an in-law suite, having one can make the transition easier and day-to-day living more enjoyable for all involved. Everyone wants their privacy, no matter how much they love their family. So, having a private suite for your parents or grandparents can make living in one home more comfortable.
- Rental Income Can Help Ease the Strain of Monthly Payments & Help You Pay off Your Mortgage Quicker
Paying off your mortgage faster is one of the top reasons people opt to include a rental suite in their homes. Using the rental suite’s income, you can fast-track your payments and get closer to paying down your mortgage.
Most mortgages come with stipulations regarding how often and how much extra you can put toward your mortgage each year. You’ll be able to find this information in your documents or by talking to your mortgage advisor. Typically, you’re able to add additional payments on a monthly basis or pay in one lump sum annually.
As the cost of living increases, having that additional income each month can drastically reduce the cost burden of your home and potentially leave you with additional cash flow for other expenses.
- Rental Demand Has Increased
Finding and keeping good tenants is the scariest part of having any type of rental, whether it be a secondary property or rental suite. When you have any gap in tenancy, you’re operating at a loss. This loss is significantly less when you’re dealing with a rental suite than a rental property, but it’s still not ideal.
The good news is that with rising interest rates and the cost of housing, buying a home isn’t an option for many people right now, leaving them with no choice but to rent. Another positive factor for homeowners with rental suites is that rental inventory is relatively low.
The combination of high demand and low inventory means you’ll likely find a tenant willing to pay top dollar for your place.
When considering purchasing a home with a rental suite, always make sure you can pay your monthly mortgage without the additional cash flow from rent. You do not want to be in a position where you’ve overextended yourself and then go a few months without rental income. Always be prepared to cover the costs of maintenance and repairs, as well as your entire monthly mortgage payment, should that be necessary.