In a real estate market where property prices are constantly soaring, diminishing the returns for investors, how can one achieve an upward trajectory in investment returns? Look no further than the exceptional solution of Second Dwelling Units (SDUs)/ IN LAW=SUITES.
Project Share
A client purchased a bungalow as a long-term investment, consisting of three bedrooms and one bathroom on the main floor with an unfinished basement. In order to achieve a higher investment return, we decided to convert the basement into a separate Secondary Dwelling Unit (SDU).
Shortly after finding ideal tenants for the main floor, we informed them about the upcoming construction in the basement. Through the process of designing, planning, obtaining approvals, carrying out construction, and conducting inspections, we transformed the basement into a self-contained unit with two bedrooms, a living room, a bathroom, a laundry room, and an open-concept kitchen. This newly created unit can be independently occupied or rented out, effectively turning one investment property into two, doubling the rental income and generating a strong cash flow.
We highly recommend that long-term real estate investors consider legally and properly converting their basements into Secondary Dwelling Units (SDUs). Although this approach involves a longer process and requires professional planning and higher construction costs compared to informal methods, it ensures the legality and safety of the secondary unit, particularly in terms of fire safety and emergency exits.
By taking this route, investors can avoid concerns such as insurance denial, complaints from neighbors, or penalties from government authorities.
