More homeowners want to combine two units into one

What can you do if you live in a condo, townhouse or multifamily home, and you need more space but don’t want to move?

For a growing number of people, the solution is to buy the unit next door, tear down a wall, and create a single, larger unit. Recently there’s been an uptick in the number of people combining two small condos into one larger one, or converting a two- or three-family home into a single-family home.

If you’re considering such a move, there’s a lot to keep in mind.

First of all, you’ll need to make sure such a project is allowed. In a condo, you’ll probably need permission from the board or homeowners association. If you’re turning a multi-family home into a single-family home, you’ll need to make sure this is okay under the local zoning rules.

You’ll also want to make sure you’re adding value. In some places, a single larger unit might be more desirable and valuable than two smaller units, but that’s not always the case, and you might be better off just selling and moving to a larger home. That’s especially true since you’ll have to factor in construction and remodeling costs – you probably don’t want to live in a home that has two separate kitchens, for example.

Arranging financing can be more difficult, since this won’t be a typical, off-the-shelf project for a mortgage lender. Rather than a simple refinancing, you might need to get a completely new mortgage for the combined property, and use it to pay off your existing mortgage. If you’re doing extensive remodeling, you might need to get a standard mortgage combined with a construction loan.

Also, you’ll want to look into what your new property taxes will be. The property will probably be reassessed at some point, and you can’t just assume the new tax will be the sum of the old taxes on the separate units.

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