What is a duplex house? A duplex house is a house with two independent units that have completely separate entrances, electric and heating supplies, garages, and backyards but they share a common wall that separates the two units. Duplex houses usually don’t have any connections between the units so both of the units are run independently.
Duplex houses however are placed on a single piece of land or plot. This means that in paperwork the units are considered a single plot home but the home is divided by the builder into two independent units.
Let me explain. In a housing society or community, the land is divided into plots of different sizes. The size of the plot can be variable. The most common sizes are 1250 sqft. , 2250 sqft. and 4500sqft. However, the sizes can vary from society to society and neighbourhood to neighbourhood. These plots are then allowed to be built as single or dual family housing by the society to either builders or landowners. If the landowner decides that the plot size is big enough to fit two units in the plot, he may ask the society to build a duplex in the space instead of a single-family home.
The landowner can also ask to build a triplex or quadplex also if the space is large enough. But building more than four units in a single plot is usually not allowed by most societies. For more than four units the society usually requires the purchase of land dedicated for commercial purposes such as multi-family housing.
So, to review a duplex is a house with two units built on a single plot of land after gaining approval from the housing authority of the area. Duplexes are totally legal in the US and other countries. Duplexes are built after approvals and they require dual connections of electricity, water, and heating. Most housing societies and corporations allow the construction of duplexes without any problems. But some don’t so it is best to check with your local authority for approval and requirements before you hire an architect.
Duplexes don’t refer to a house that has a ground unit and a first-floor unit in the general construction lingua. These types of houses have two portions. A ground portion and a first-floor portion. Most double-storey houses with separate first-floor entrances can be converted to two portion houses. These types of houses are not completely independent and may have shared heating, electricity, and water meters. As this type of housing can cause turmoil between the two residents they are usually not preferred by investors seeking rental income.
Most tenants in portioned houses fight over the electricity bill for example by saying that the other tenant was the one running the air conditioner 24/7 and not them so they should pay most of the bill and vice-versa. This is the main reason why investors run away from portioned houses, as they don’t want to deal with such things. Although there are ways to deal with this by using private electric and heating/gas meters, older investors do shy away from such properties.
Portioned houses also attract lower rents from tenants as the tenants themselves want to have nothing to do with fighting every month.
Duplexes however due to having two independent units with dual meters for utilities can be run as multifamily housing without the need for buying commercial land. If any of you know the real estate market you would probably be aware that commercial land is almost 3x the price of residential land. Hence, in my honest opinion for rental income, a duplex is the way to go. Keep away from portioned houses. However, if you already own a portioned house you should definitely consider splitting the utilities by using by installing private on-site meters for each tenant.
What is the use for building a duplex house?
Duplexes are a great way to earn some rental money on the side. As duplexes are totally independent units they can be rented out separately. The utilities and even the garages of duplexes are separate. Thus there is no way for the tenants to fight over the utility bills. Both tenants can enjoy the same amenities such as garages and backyards.
With duplexes, it is also easy to raise the rents of both the units together. As both units have the same structure and neighbourhood. These details are very favourable for real estate investors that invest in rental real estate opportunities.
Similarly, with a single-family home, there is a greater risk involved if the owner is paying a mortgage. If the tenant decides to leave the owner needs to fill the home as soon as possible or he will have to pay a huge mortgage bill straight out of pocket every month till he can find a new tenant. With a duplex, the risk is halved as the owner can have some breathing room. The owner will have to pay only half of the mortgage bill till he can find a new tenant. Since it is relatively easy for the owner to manage a $1000 half mortgage bill as compared to a $2000 full mortgage bill duplexes continue to be popular.
Why are duplex houses built with units that are mirror-image of each other?
Most duplexes are built with both units as mirror images of each other. This is to ensure that each unit has the same number of rooms and also the same placement of different rooms in space. This can be a good tool to negotiate rents with tenants as both the tenants will have to pay the same rent for each unit.
Most builders also prefer to build a mirror image duplex as it greatly streamlines the process of construction and finishing the house.
How are duplex houses sold? What is the catch with selling a duplex?
Duplexes cannot be sold as two independent units separately. As they both share a plot of land meant for a single house the two units will be sold to a single buyer who will hold the title of both the units and the land/plot. This is usually not a big deal as finding an investor who wants a duplex is a very easy task. But this is one thing that you must keep in mind when you go out shopping for a duplex.
There is one more thing that I should mention here. Duplexes cannot be sold as freehold independently, however, they still can be leased for long periods, such as 99 years, separately to two different clients.
These details are things that you won’t find mentioned in any real estate deal separately as they are usually written in the fine print. You can only learn these things from experience.
Difference between a single-family and a duplex
A single-family house will be a single unit while a duplex will be a dual unit house. Both of them will be placed on a single plot of land and will be sold as a single house. But the duplex has the advantage of attracting higher rents as compared to a single-family since a duplex can accommodate two tenants while a single-family house will only accommodate a single tenant.
You learn about the differences between a house and a mansion here.
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