Buying a Home with an In-Law Suite

Pros and cons, the different types, price, questions and more!

Do you have parents, grand parents or kids that you'd like to stay with you in your new home? An "in-law" suite is an incredible features of a house that allows you to have that extra space for people to stay, but still retain privacy for both parties. In this blog post we'll go over what an in-law suite is, they different types of in-law suites and the pros and cons of having one in your home. 

If you want to see an example of homes in Florida with in-law suites, check out this video I uploaded of model home tours with private suites in Fort Pierce, Florida: 

What is an In-Law Suite?

An in-law suite is a living space for parents, in-laws, kids, grandparents or other relatives that provides a private space for them to live in either an attached or detached location on the property. This kind of space makes the home you're buying a "multigenerational home", which is becoming more and more popular with home buyers in 2024.

These spaces are also referred to as a mother-in-law suite, guest house, nanny quarters and even a few others that we'll go over in the next section. In-law suites usually come with the ammenedites required to live in that space without needing to utilize the main space, although not always. Some will even have the ability to access the space without ever stepping foot into the home itself. Builders accomplish this by having a seperate entrence on the outside of the house. Another optional feature is having a door that connects the in-law suite to the main house that can be locked if the owner chooses. 

Different kinds of In-Law Suites 

In-law suites can be used for many different scenarios and occupants, not just in-laws! For that reason that are a lot of different kinds of these spaces that are most often broken up into categories

Mother-In-Law Suite

This is by far the most common kind of in-law suite, and even shares part of the name! A mother-in-law suite is most often occupied by parents or in-laws either permenantly, or temporily when they are in town. If this sounds like a good option for you, consider looking for features like an accessible ramp, walk-in shower, and non slip flooring. Accessibily is incredibly important with a space like this due to the older age of the occupants. 

Guest House

A guest house is a great option for friends and family to come and visit. Having such a space will be a huge blessing to those coming into town who now don't have to spend money to stay at a hotel and make a drive to visit. Guest houses do require more space to put in, as they aren't usually built onto the house, but instead are a seperate miniture house entirely. Features to consider in guest houses are smart TV's, mini-bar, and plenty of toiltries and towels to make your guests feel right at home. 

Nanny Quarters 

Live-in nannies are becoming more and more popular in a culture where both parents have successful careers. Having a nanny can be a necessity, and having an extra space for your nanny to feel a little more seperate at home from her work can make all the difference. In addition to making your nanny feel more comfortable you will also save money on paying for a commute and can also be sure that she's close by if an emergency comes up. Keep your nanny comfortable with amenities like a washer, dryer and kitchen. 

Temporary Rental

Want to use your in-law suite to make some extra money? Many people have repurposed their in-law suite to use for popular services like Air-bnb! Be aware that there are many requirements for your space to be applicable to rent out in such services such as:

- Entrance / exit

- Sleeping area

- Kitchen with running water / stove

- Bathroom with bathing area

Renting out your space can be a great way to make a secondary income if you have the features required and have some extra time to put in the work to make your rental customers happy!

Benefits of an in-law suite

As you've already read, there are so many benefits of having an in-law suite. Here are just a few of the reasons to buy a home with an in-law suite

Keeps your guests nearby

What's better than being close to your friends and family? In-law suites allow you to do just that, which can save you valuable and precious time when they are in town for only a short time. As we discussed with the nanny suite or even an elderly relative, being nearby can be extremely important, especially in an emergency

Adds value to your home

Building or buying a home with an in-law suite can yeild a great return when or if you decide to sell your home. The appraised value of homes with a mother-in-law suite that are legally able to be rented out can be 7%-9% higher than others in the area. Not only can that extra square footage result in a higher listing price for your home, but buyers who have larger families or traveling freinds will pay more for your home if it has such a space. 

Qualifies for Tax Benefits

There may be tax credits for having an in-law suite. For example, iif you're paying for more than half of your relative's support, you may be able to claim them as a dependent. You may also quality for a home office tax deduction if that' the in law suite's primary use. If you rent out the space, you may be subject to pay taxes on rental income, however you can also receive tax deductions on utilities, repairs, interest, insurance and more. Landlords may also qualify for the pass-through tax deduction where you could deduct 20% of your net rental income. 

Saves you money

Having an in-law suite is a great way to transform your home into a multigenerational home or negate the cost of long-term care. Examples include nursing homes for parents or a dorm room for a student. The ways to save money seem endless, even if the inital cost can be a little steep. 

Cons of buying or building an In-Law Suite

If you're still reading, it means you are smart individual who knows that there are two sides to every coin. Even though there are some incredible benefits to building or buying an in-law suite, it is true that there are also some drawbacks to building such a space. Here are a few to look out for. 

Less Privacy

It doesn't matter if your guests are relatives, friends or customers. Having and  using an in-law suite will result in less privacy. An in-law suite will result in a lifestyle change, which is something to plan for. Being so close to others can be a double edged sword, and may result in some unwanted attention. This is especially important to look out for if you're someone who works from home, has younge children or pets.

Costly Upkeep

While there are tax benefits and opportunites to earn money from your in-law suite, there are definitely going to be expenses that come with your in-law suite. Remember the amenities that we talked about earlier? Wifi, electric, water, cleaning services and cable / streaming services are just a start to the expenses you need to account for when thinking of buying or building an in-law suite. 

Complex Building process

There are many factors that you need to take into account when creating an in-law suite. Poor planning can become a battleground of mistakes that will only result in more headaches down the line. Make sure to get the correct permits, and only hire people that you trust to do the work. Forgetting necessary features could set back your construction timeline and could also cost you more money and stress in the future. 

Weighing the cost of an in-law suite

Now that you know more about what in-law suites are, and the pros and cons that they come with, you should have a better idea if this is something you want when buying a home or building on to your existing home. Having a mother-in-law suite can be such a joy and blessing when family or friends are in town and may even be a successful revenue stream for you if you rent it out. However, it can also come with costs and challenges that you want to be prepared for if you're ready to take that next step. 

If you're on Florida's east coast and are looking for a home with an in-law suite, give me a call or email anytime and I'd love to talk to you more about it. Thanks for reading!

- Spencer Bailey

Spencer.Bailey507@gmail.com
507-951-2934