Are you considering ways to build a guest house? Adding this type of accommodation to your residential property is a great way to add living space for your family and guests. In addition, it can provide a new stream of income. You can use it for a vacation rental (VRBO) or a regular rental. There are a few hurdles to get over if you are considering investing in having a new guest house built on your property.
Zoning
You will want to check how your property is zoned and what your area allows for that zoning. Adding a guest house is referred to as an ADU (accessory dwelling unit) when it comes to zoning language. In other words, it is a secondary housing unit on a single residential property lot. You can locate how your property is zoned by looking up the tax record under “Class” category.
With the increase of baby-boomers retiring and needing assisted living accommodations, adding a guest house has become increasingly popular and a good solution for this need. If your home is not zoned to accommodate an ADU then most likely you will get approved if you apply for the zone change and approval by your city as it is currently a very common and substantiated request.
Water & Sewer
Your property will have to be able to accommodate the added square footage of the guesthouse. This will be dependent upon if you have city water and sewer of if you have a septic system and well water.
If you have city water and sewer then the added square footage will have to be approved by the city in order for your guesthouse to be able to tap into your current water and sewer pipes.
Alternatively, if you have a septic system for sewer you will want to review your current septic permit for how many bedrooms it is perked for. If your primary home has already maxed out the perk allowance then you will have to apply for an increased septic permit to accommodate the added bedrooms that will be in your guesthouse. In some cases, this may require you to upgrade your current septic system. If you have well water then you will want to evaluate your current water pump and make sure it will be able to handle the additional water usage that will be coming from the guesthouse.
Building Restrictions
Be sure to check with your city and HOA if you have one for any building restrictions that may apply to your new guesthouse. You don’t want to build only to be penalized later. Building a feature that is restricted may cause you to be forced to remove it. Restrictions can apply to everything from the facing material used to landscaping to the allowance of a guesthouse in general.
Build to Code
It’s important to be sure to build your guest house to code. If your property is inspected and is not to code you may have to reconstruct part or all of it. In addition, when you are selecting a contractor be sure to chose one that is aware of the local codes concerning guest houses. The experienced builders will be familiar with what they are. They are accustomed to building to code without you having to do extra footwork to find out yourself.
Guest House VRBO
If you’re thinking you want to invest in building a guest house for a vacation rental then the features of the guesthouse can be parred down. For example, a short term rental such as a vacation cottage does not necessarily need a full kitchen. A mini-kitchenette would suffice as a few day or week rental. This is especially the case if your location is close to an entertainment area that has lots of restaurant venues to chose from. Most likely your guests will be out exploring and not have a need for a full kitchen. A sink and small refrigerator would suffice.
Guest House Rental
If you want to position your guest house for longer term tenants such as family members or yearly leased tenants then you’ll want to provide full amenities. This includes a full kitchen, bathroom and separation of the bedroom area and living room area. These types of tenants will need to be able to have everything for regular long term living.
There are pluses and minuses to both types of guesthouse accommodations. The short term vacation rental can be controlled by you. You can decide how many days out of the year you want it to be occupied. Only advertise it for those days. The better location you have the more you can charge for the nightly rate. In addition, the more it will be booked for the nights you have available. On the downside you will have total strangers coming onto your property to access the guesthouse. Some loss of privacy with greater cash flow.
The long term vacation rental has the least amount of management. You place your tenants annually, collect monthly rent and maintain the guesthouse when something breaks. There is only one tenant party instead of a steady stream of new ones. On the other hand you’re locked into the lease. Your stuck with your tenants for a season even if you decide you don’t really like them.
After taking all of these things into consideration it may seem overwhelming and discouraging to add a guesthouse. Most homeowners agree the benefits far out weigh the work it takes to have one built. In addition, if you chose the right builder they will move through most of the restrictions and requirements. The result will be a guest house build properly.
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