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Do You Really Want To Live Next Door To Your Tenant?

It is not the most ideal situation for many people – but for some – especially those looking to “own” their own home, buying a duplex or multi-family dwelling, can be a good idea. 

I've done it - and know several people who are or have bought a du/triplex then lived in one unit – rented out the others - and not only did it work for them financially, but it got them into a home that they might not have otherwise been able to do.


Some pros about owner occupied investments:

Easier financing – there are many more owner carrybacks, or other traditional financing options available for owner living on site properties because it is considered a primary residence.

Personal monthly costs can often be subsidized by the rental income.

Insurance costs may be less because it’s considered a primary residence.

You can select your own tenants and you may be more selective (in Arizona) if you live in a plex that has 4 units or less.

Some cons of owner-occupied investment properties:

Shared living.  Although it is your property – the rented units are the tenants home.  If you are very controlling or very picky about the exterior, guests, etc., then maybe it’s not such a good idea.

“Knocks on the door”. If tenants know where you live, they are more likely to knock on your door to let you know when something is needed.  You also do not have a lot of privacy as tenants will watch when you come and go.

Tax deductions. Owner occupied properties do not get all the tax benefits that investment properties do.  So, it is always a good idea to consult an accountant before purchasing a plex property.

Conflicts of interest. I see this as one of the biggest cons of owner occupied investment properties.  As a rule, while I am very friendly and do have nic conversations with tenants,  I do have a “stopping” point.  In other words, socializing with tenants and being friends all sounds like a good idea, until there is a problem.

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This blog is written with my opinions and my opinions are  presented with accuracy but not guarantees. Please talk to a professional before making any real estate, financial or agency decisions.    Gabrielle Kamahele Rhind - 2014. If you want to reprint parts of this - just email me for my permission: .


Comment balloon 3 commentsGabrielle Kamahele Rhind • December 01 2013 12:29PM


Gab ....I sold a couple from Maryland a four-plex years ago ....they lived in one and rented the other 3 out ....It worked great for them!

Have a great night in AZ!

Posted by Rob Thomas, Bristol TN-VA & Tri Cities Agent, ABR, GRI, e-Pro (Prestige Homes of The Tri Cities, Inc. CALL....423-341-6954) almost 6 years ago

I have a good friend that bought a duplex, lived in one half and rented out the other. He said he probably wouldn't do it again, just because he doesn't 'have' to now. He said it worked perfectly for what he needed at the time.

Have a great day!

Posted by Steven Barks, Director of Operations (Worth Clark Realty) almost 6 years ago

I think that taking on an income property is one thing, not sure about sharing walls with a tenant.  I had a client that was looking to buy the house next door to his when it went into foreclosure.  His wife did not like the idea for some of the reasons you mentioned.  He was a neat freak and would not like to see that the house and yard were not meticulously maintained.  It is rare to find a tenant that cares about the home as much as an owner would.

Posted by Karen Feltman, Relocation Specialist in Cedar Rapids, Iowa (Cedar Rapids/Iowa City, IA KW Legacy Group) almost 6 years ago

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