UrbanTurf Reader Asks: Are Million-Dollar Buyers Looking to Be Landlords?

• August 22nd 2011

by UrbanTurf Staff

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In this installment of UrbanTurf Reader Asks, a reader who owns a Capitol Hill home with a basement-level rental unit wonders if he should keep the unit intact when he renovates the home or if integrating it into the main house will enhance resale value for those in the market for a million-dollar home.

We own an 1,800 square-foot, three-bedroom, 2.5-bath house a few blocks east of Eastern Market. We're planning renovations, and one question is whether we should continue to rent out a separate two-bedroom, 900 square-foot unit on the lower level that rents for $1,600/month, or whether we should integrate that space into the house to use it as a family room, home gym or play room for the kids. Of course, lots of considerations play a role in this decision (how much we need the extra space vs. the income, etc.), but what we're curious about is how it will affect the value.

Will the property be worth more if we keep the rental unit (and update it in our renovations), or will it be worth more if we integrate it into the main house? To the extent that it's relevant, we bought the house for approximately $900,000, and so the question might also be rephrased as: Do people shopping for million dollar-homes want to be landlords, or do they just want more space?

Post your neighborhood suggestions in the comments section. If you would like to submit a question for UrbanTurf Reader Asks, send an email to editor2011@urbanturf.com.

This article originally published at http://dc.urbanturf.production.logicbrush.com/articles/blog/urbanturf_reader_asks_are_million-dollar_buyers_looking_to_be_landlords/4022.