In the rental real estate sector this is more than a reality. If you have a house or an apartment and you want to rent it out, dividing it into several apartments is an interesting option that increases its profitability and enhances your property.
By dividing your home into two, three or four apartments, you can earn double or even triple the monthly income compared to what you would have earned with an individual property.
The advantage lies in the fact that it is rare that all the apartments are empty, whereas with an individual property, your monthly income will drop to zero if the tenant decides to leave. It’s all or nothing.
However, it is important to take certain precautions, to check the legal and regulatory framework and to have a good strategy before embarking on a division and on the work.
Table of Contents
- 1- Dividing a property: An interesting option
- 2 -A property adapted to your project :
- 3- Why divide a property?
- 4- How to divide a property?
1- Dividing a property: An interesting option
While the goal of any rental investment is to make a profit, finding the right tenants can be difficult. For maximum profitability, an effective strategy must be adopted.
Several options are available, including dividing a property. For others it may be a strategy of increasing the rent. It will be necessary to ensure that this increase is not abusive and that it complies with the laws and regulations.
The increase in the value of the apartment creates a feeling of luxury which increases the price of the rent, and maximizes its profitability. This technique consists of renovating and modernizing the building and its facilities, (ecological facilities for example).
Finally, there is the most interesting option, the division of a property into several units. This method optimizes your profits. You will be able to make a property in short duration and another in renting at the year.
2 -A property adapted to your project :
The first step to a successful division is to look for a property that suits your project. To do this, do not set any criteria of surface area. Let yourself be guided by your intuition and especially take into account the fact that the property will not be used as your home but will be used by other people.
So avoid listening too much to your tastes. Make sure that it can interest the maximum number of people possible. To divide a property, you will need a fairly large area for two reasons. First, because you will have to divide it, and second, because the larger the property, the lower the price per square foot.
3- Why divide a property?
It will always be necessary to make a trade-off because the profitability will certainly be greater but so will the rental management. Thus, the other strategies mentioned in the previous chapters can also be used (reduction, increase, improvement).
This management requirement with the division of the properties can be explained by the fact that the tenants of the apartments and studios move more frequently than those of the large units. This is the case, for example, for students.
4- How to divide a property?
It is good to have ambition, but it is also necessary to have the means. Certain verifications must be made to ensure the success of your project.
Necessary types of equipment:
Indeed, it is not just a question of dividing a surface but it will be necessary a real autonomy between the various apartments. Thus, it will be necessary to have a water meter for each division, electricity, etc.
The rules of surface and volume :
You cannot divide your home as you wish, there are rules of surface and volume to respect. To avoid any mistakes or problems with the authorities, it is best to call on a professional.
Creation of additional square meters :
The application for a building permit is mandatory if your division work requires the creation of additional square meters greater than 20 square meters.
The same is true for the realization of works that generate an area of more than 170 square meters for the whole construction. If the work is for a smaller area, a simple declaration will suffice.