By: Alan D. Singer Published: August 2019

An Alternative to a Two Family House

Many municipalities allow for two, three or four family homes in a multi-family zone. Traditionally, these consist of a single structure with two or more units, owned by a single person or entity who rents out one or more of the apartment units. There is a growing trend for cities to expand the multi-family zone. By way of example, the city of Minneapolis has recently eliminated all single family zoning in favor of multi units. If this trend continues, construction of two, three or four family units will only increase.

In many instances a given lot may not have sufficient side yard or front yard setbacks or frontage to accommodate more than one structure in a two family zone. For a developer, that means selling the completed house to a single buyer, who would then be able to take advantage of the rental income from the second unit. An alternative is to create a two (or three of four, depending on the zoning) unit condominium, which obviates the problem of lack of setback, frontage of FAR.

In that way each unit can be sold separately, thus increasing the sales prices. The cost of creating the condominium, although not inexpensive, should be far outweighed by the additional sales prices. Creating the condominium involves the same process as with larger multi-family projects, and the offering plan contains the same provisions, although creation of the condominium declaration, budget, common element percentages and common areas are much less complicated.

If interested one should consult an attorney who is familiar with the Department of Law requirements for submission of an offering plan.

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