Is there Value in a Converted Garage?
- July 21st, 2020
- Matt Frentheway
- No comments
So many of us are looking for that extra living space in our homes. Many people are converting their garage into an office, gym, studio, game room, she shed, or man cave. Garage conversion can be a great way to create an additional living area to your house. Typically, when we’ve seen this conversion it’s with a detached garage and their driveway is long. The homeowner will usually park in the driveway rather than in the garage so they end up thinking, “Might as well make good use of the garage since I’m not parking in it.” Converting your garage into an extension of your home might be exactly what you’re looking for at the moment. But there are, of course, pros and cons.
The first thing someone thinks of when they look to convert their garage, or after they have finished the project or when they’re getting ready to sell their home is, “What is the value of a converted garage?” Realtors, Agents, and Appraisers find that this topic comes up quite often. There are a variety of answers to this single question so we’ll try to cover as many as possible.
The obvious pro to converting your garage is the additional living space. If you’ve only been using your garage for storage then you would do better to convert the garage and use it for a more. A common recommendation would be to convert your garage into a second living unit that you could rent out. Be sure to check first and make sure it’s legal with your local zoning.
Converting your garage into an extra space for you and your family or for a rental unit might seem great when you’re the homeowner. The cons could come in when you decide to sell the property. If all you’ve done is a few cosmetic things, you’re probably fine. But if you’ve made structural changes or removed the garage door completely, this might be an issue. Some home buyers might love that you’ve converted the garage into this extra space. However, there are some, particularly Utah home buyers that won’t like that your home doesn’t come with a garage. With the multiple seasons here in Utah, many could see the lack of garage as a deterrent.
First- Have there been any structural changes. For example, does the garage now have a sliding glass door? Has the garage door been removed? Are their additional walls now inside the garage?
Second- We look to make sure if the garage has been converted, we check to see who did the conversion and if it was done through the proper channels. Did a professional do the job? Were the permits pulled for the converted garage? Or was this perhaps a family project put together with YouTube tutorials?
Third- Like any appraisal, we find it important to look at comps. We’ll look to see if garage conversion is typical with this type of house in this particular neighborhood.
Fourth- If the garage was converted with the intention of renting out the unit, we would need to make sure that this was legal in the area.
Most of the time a garage will still be valued as a garage even if it has been converted. Of course, if the garage door is off and this is meant to be considered a living space then it could be valued accordingly. But just as in the four steps above, this would have to be done by a professional with the proper permits and fairly typical in the neighborhood.
If these rules are followed and your garage is now considered to be legally used as a second unit of residence then it’s possible that the garage could be valued as a duplex.
If your garage was converted without professional assistance or permits then it will just be valued as a garage.
There is also the possibility that if the garage has been converted illegally and has no garage door it can be valued as simply a storage space. So be careful!
There are so many possibilities when it comes to finding the value in a converted garage that we don’t think it would be possible to list them all here. The long and short of it is: if you’re going to convert your garage and want it to be valued as an extra living space or a second unit that you’d be able to rent out, be sure to have it professionally converted and obtain all the necessary permits. Otherwise, you’re converted garage will still be valued and appraised as a garage.
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