How to build a duplex?

[Fahrns]

Hi folks,
my current home is a 1950's bungalow on a 50x120ft R2 lot in the NW near the LRT. I'm interested in knocking it down and building a new semi-detached duplex (sell one side and live in the other). I really like the location and foresee myself in the neighborhood for a long time.

I don't even know where to start. My preference would be to work with a builder or be the prime contractor myself so that I can have some design influence. How does one go about finding the financing to build? Go to the bank? Work with a builder?

Here are some basic numbers:
Current home value (~$550K)
Equity in my home (~$200K)
Liquid assets (~$100K)

Estimated building costs ($800-$1MM) -depending on trim level
Selling price of one unit ($750-850K) - have seen units go for $700-950K in the neighborhood.

What are my options? I'm not interested in buying a completed home.

[keratosis]

First thing you do is make sure your block is even zoned for this type of development.

[Ducay]

Problem is normally builders do this because the profit is in selling both. You're going to be hiring a building and their money is going to come from any profit you make on selling the other.

Based on the nature of questions you've asked, I do not suggest you do it as the prime contractor.

"so I can have some design influence", you think when you hire a builder they just build it based on some spec design and don't let you make any changes?

[corporatejay]

Originally Posted by keratosis

First thing you do is make sure your block is even zoned for this type of development.

He already said it was zoned r2

[corporatejay]

I think kermitology did this in renfrew. Maybe pm him.

[Fahrns]

Originally Posted by Ducay

Problem is normally builders do this because the profit is in selling both. You're going to be hiring a building and their money is going to come from any profit you make on selling the other.

Based on the nature of questions you've asked, I do not suggest you do it as the prime contractor.

"so I can have some design influence", you think when you hire a builder they just build it based on some spec design and don't let you make any changes?

My understanding is that most builders have a few 'stock' duplex designs that they build. Obviously you can tweak those to some extent, but you can't completely redesign without spending big bucks on engineering and design.

I started this thread because I'm interested in learning about the money side of things. I.e. What options do builders provide? What are my options with traditional lenders like my bank? Are there other financing options out there? Tax issues? etc...

[kermitology]

Yes, I did this. Don't use a builder unless they're a custom home builder. It's obscenely expensive if you don't take more control of it.

Send me a PM and I can give you a bunch of information.

[Rhettzky]

That's a pretty big lot. Couldn't you subdivide it and do 2 infills?

[Ducay]

Originally Posted by fotze

I've heard its cheaper to build attached, plus you can get more money selling the larger square footage you get with attached. I think.

Ya, why make 2 acceptable detached houses when you can make 2 cheap attached houses?

All the cost of a single family home with all the headaches of condo ownership.

[Fahrns]

I'm set on two attached homes. Thanks for your opinion. Back to the main questions about financing please. Thanks.

Sent from my Nexus 7 using Tapatalk

[zarrell]

PM sent.

[Calgary14]

Originally Posted by Fahrns

My understanding is that most builders have a few 'stock' duplex designs that they build. Obviously you can tweak those to some extent, but you can't completely redesign without spending big bucks on engineering and design.

I started this thread because I'm interested in learning about the money side of things. I.e. What options do builders provide? What are my options with traditional lenders like my bank? Are there other financing options out there? Tax issues? etc...

For tax the equity you have now is obviously non taxable because it's a principal residence. The total cost of the build would be split in half (assuming both sides are equal) and that would be the cost of the side you sell. The taxable gain would be the difference in cost and selling price (only half is a taxable capital gain)

Another option would be to rent out the other side. In this case you'd have rental income and you could deduct the expenses against this (ie utilities, taxes, mortgage interest for rental portion, etc). CCA could be take as well but you'd need to determine whether it would be worth it

[manwiches]

be careful who you use. there are some untrustworthy custom builders out there. research research research. look at their body of work, and if you can, if the people who built were happy with the process. I have a friend who just finished building with one particular builder, and he had a dreadful experience.

PM me if you want details on who not to use. I'd rather not slander someone on a public forum

[RogerWilco]

Originally Posted by Ducay

Ya, why make 2 acceptable detached houses when you can make 2 cheap attached houses?

All the cost of a single family home with all the headaches of condo ownership.

Subdividing a 50' lot for two single detached would create houses that are 17' wide and extreamly deep to make up your lot coverage. Building a semi- detached on the lot would allow for a 21' wide plan that retains valuable frontage where you can bring in more light. The plan doesn't need to be a deep and retains more rear yard useable area for garage and patio/deck area. (A duplex is one plan on top of the other, I'm assuming the OP is talking about semi-detached not duplex?)

[RogerWilco]

Also read up on the difference between a contextual semi-detached and a discretionary semi-detached. You have to follow more strict rules going contextual but it is normally easier and faster to get approved. Discretionary you can try to do much more but the approval process is longer and an approval can be appealed by anyone with $100 in their pocket. It is good to get yourself familiar with these rules and don't just rely on your builder or designer. That will help you retain more control of what is happening.

I know you said your lot is R2. But check to see if it is actually RC-2 which I would guess it is.

[sun]

I think you just build to uniplexes and then stick them together.

[Fahrns]

Originally Posted by RogerWilco

Also read up on the difference between a contextual semi-detached and a discretionary semi-detached. You have to follow more strict rules going contextual but it is normally easier and faster to get approved. Discretionary you can try to do much more but the approval process is longer and an approval can be appealed by anyone with $100 in their pocket. It is good to get yourself familiar with these rules and don't just rely on your builder or designer. That will help you retain more control of what is happening.

I'm looking at contextual semi-detached. I'm a board member on my community association and see some of the discretionary applications that roll through. Not looking at doing anything abstract. Just a tasteful infill that meets my needs and can easily sell the other half.

Originally Posted by RogerWilco

I know you said your lot is R2. But check to see if it is actually RC-2 which I would guess it is.

You are correct. The zoning is RC-2.

[Clarkey]

I think getting financing is difficult if you are looking at going outside of the builder route.

[calgarygeologist]

I wanted to do this previously but couldn't find decent land at a reasonable price. From my research I was very interested in a "modular" home builder called Karoleena. They built a low rise condo building across the street from me when I was living in Marda Loop and it was a very interesting process to watch. I have a friend who did some work with Karoleena back in their early days and he had good things to say about the people there and the company which was re-assuring.

Check it out:
http://karoleena.com/

[kermitology]

Originally Posted by Clarkey

I think getting financing is difficult if you are looking at going outside of the builder route.

Not at all. It's just different.