I have a large home that could be converted into an upper and downstairs unit, by removing or closing off the stairs and converting a large laundry area into a kitchen. It was a suite formerly, before a major reno 10 years ago. (Has separate entrance, 1500sqft, garden level with good sized windows, currently shared laundry).
We are now trying to decide across three choices:
1. Convert it back to a 3 bedroom, 1 bath suite, rent would likely be $1800 to $2000 per month. We would live upstairs, (2 bed+den, 2 bath) most likely, but could get up to $2500 for it.
2. No reno. Rent out individual bedrooms, at $700 each (utilities included, so estimate $600/mo each x 3). Maybe experience higher damage and vacancies and weird people. Room rentals do not get protection under the residential act, however.
3. Sell the home.
Note, the unit after reno could have its own sub-panel and sub-metering for electricity calculations, but heat and other utilities are all shared. It would not be a true fully separated suite that way.
We are in a suburb away from downtown core, 2 miles from grocery store, but with transit access nearby. I don't think AirBNB is the way to go. Room rentals to international students might work, and is very common once schools fully restart, but they tend to expect laundry and cleaning services.
I am trying to decide when it is worth converting a SFH into an income property and how much to spend on a renovation. A key issue is that we need to revisit our overall electrical service to the home, it is currently 100A, which is borderline for adding another stove plus another laundry. Would need a sharp pencil on the electrical load calcs to make it work. That could be expensive.
Question:Is there a good rule of thumb for the max to spend on a suite conversion to get $1800/mo in rent?
Any cautionary words of experience? What would you do?
Flagging
@waltworks and
@Dicey for any pearls you have.