Recently I showed a single family residential homes to buyers. They want to buy a house for their own family, for their own piece of the American dream. Imagine our surprise to hear that we just might have to come back to see the living room tomorrow – the tenant who occupies it is not home and locked it up. Ditto the attic, and parts of the basement.
Every room of this house had a lock on it. The attic was subdivided into two small apartments, each with a padlock and no fire escape. The part of the basement we could see was shared by two people. I shudder to think of the part that was occupied by the third person; Harry Potter’s room under the stairs would look spacious by comparison. There was no way these people could exit quickly in a fire. The kitchen was amazingly neat and clean, as were the bathrooms, which were shared by ALL 13 OCCUPANTS of the 3 bedroom 2 bath colonial on a nice residential street. The owner and her 2 children were among those living there, in two rooms.
The house was a reasonable price, in a solid middle class neighborhood, and was in reasonable condition from what we could see. Still, the buyer decided he did not want to live in a “slum” since this is what illegal occupancy designated in the area he was from. He also did not want to buy a home that had obviously not had “gentle” use recently. We did not come back later for a second viewing.
Illegal occupancy of a home is dangerous and also degrades a neighborhood in terms of resale value. When the practice of illegally dividing a home meant for one family into a boarding house for several families continues unchecked, there is a drain on local resources and fire hazards result.
In the situation I mentioned, it turns out the owner of the house was forced to sell, and to evict the occupants, as the local fire inspector discovered many hazards that could endanger not only the occupants of that house, but their neighbors as well. Sometimes these problems are discovered by officials purely as a matter of consequence – electrical fires, health problems cause emergency personnel to intervene, and the illegal occupancy is discovered. Other times, there are anonymous tips from neighbors or from disgruntled tenants themselves.
When the house sold, below market value, the owner had the expense of removing all the extra doors and locks and makeshift walls, in order for the certificate of occupancy to be issued so the sale could proceed. She could not have afforded to keep the house without the income from the illegal tenants. Clearly, when she bought the house and set herself up as a landlady she thought she had landed on easy street. Buy a home and it pays for itself! It can, but you need to work within the law.
If you are considering buying a home and renting out the basement or attic in order to meet the mortgage, please consider the local laws on zoning and fire safety. You might be buying a big headache, possible a heartache, and incurring more expense than you realize unless you follow the law.