What to know before buying a home with a guest house



Thinking of buying a home with a guest house? There are multiple reasons why you might want the extra space. Whether you have the need to accommodate older relatives long term, or grown children looking for some privacy or just a separate space for guests when they visit. As we age, we tend to have certain preferences about our homes, so a guest house means no one is irritated over different habits. Whatever the reason, you have options when looking for an in-law suite, guest house or attached apartment.

But guesthouses “(also known as “accessory dwelling units,” or ADUs) aren’t all money and in-law magic.” Purchasing a property with an ADU can be a legal and financial nightmare if you’re not prepared. Before adding an ADU to your new home’s plans, you’ll want to factor in the costs and logistics involved.



According to Jamie Wiebe on Realtor.com, there are 7 things you should consider before taking the leap and purchasing a home with a guest house.


  1. Understand your tenancy options

  2. Ensure the guesthouse is properly permitted

  3. Understand your mortgage financing

  4. Brush up on the rental market

  5. Get comfortable with communal living

  6. Examine the legal issues

  7. Split your utilities (or don’t)


The benefits of owning a guest home means: a place for guests, a personal escape, real estate value, renting, accommodation for the elderly, suitable for separate living, and more!

Overall, owning a guest house can bring you a lot more benefits than disadvantages! The best thing about it is that you can combine all of the above-mentioned benefits and actually profit from your guest house. Renting the additional dwelling unit is one of the best ways of making solid passive income. Who doesn’t want some extra cash on the side!



Of course, you do need to think about the disadvantages just so you know what you are going in to. If you are renting or setting up an Airbnb, you need to look into the laws and rules of the rental game. Also, whether you are buying a home with a guest home already on it, or you plan on building one, you need to do it legally and go through the motions of permitting. This can be time-consuming and cost a bit more.

Figuring out communal space, parking and how you split utilities (if that is what you end up doing) can take time to figure out and write up proposals. Make sure you don’t just jump at the opportunity to having a guest house, think it out and see if it fits in your lifestyle and financial plans.


Comment or contact me today to help you find the home of your dreams with guest home to boot.



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