Duplex: What Is It And Should You Buy One?

If you've been poring through Rocket Homes^SM or other online real estate listings, you may notice all the different types of homes you can purchase. A duplex might be a great option if you don't want the upkeep of owning a single-family home.

Read on to learn more about the definition of a duplex, its pros and cons and whether it's the ideal option for your new home.

What Is A Duplex?

Exactly what is a duplex? Put simply, a duplex is a multifamily property connected to another property while still maintaining separate entrances.

Duplex Vs. Other Multifamily Properties

A duplex is similar to other multifamily properties such as an apartment, a condo and a townhouse, but they each differ from a duplex in certain ways.

• Duplex versus apartment: An apartment consists of five or more independent living spaces with common areas and amenities for everyone in the complex. Apartments have shared walls and floors like duplexes. However, apartment tenants pay rent, whereas duplex owners own their duplexes. Apartment dwellers often need landlord approval to make changes within their apartments, whereas duplex owners do not.
• Duplex versus condo: A condo owner only owns the inside of the building and another entity maintains the exterior and the grounds. Duplex owners own the entire unit and structure and the land as well. Unlike duplex owners, condo owners often pay a fee to a homeowners association (HOA) that oversees common residential space management.
• Duplex versus townhouse: A duplex and a townhouse contain separate living spaces that share at least one wall. Most townhouses share two walls, with a neighbor on each side. Duplex residents, however, usually share just one wall or floor/ceiling. Townhouse owners generally have private yards, while duplex owners share common spaces, such as yards. Townhouse owners are more likely to adhere to HOA fees and guidelines.

Characteristics Of A Duplex-Type House

Duplex houses are divided into two separate units with their own entrances and addresses. Duplexes can exist side-by-side or share a wall. Two dwellings can also exist on different floors. Let’s look at other characteristics about various types of similar duplex type houses.

Types Of Duplex Houses

There are different types of duplexes, including the following:

• Ground duplex: A ground duplex is on the ground floor of an apartment. The lower floor of the duplex overlooks the front yard and contains the bedrooms – the kitchen and living room are located on the upper floor.
• Standard duplex: Standard duplexes have two floors vertically built over one another. Kitchens and living rooms are situated on the lower floor, and the upper floors house two bedrooms or a single bedroom.
• Low-rise duplex: Low-rise duplexes – just like they sound – differ from high-rise duplexes. The square footage is usually smaller and doesn't contain a large balcony on the top floor.
• Half-duplex: A half-duplex refers to one side of a duplex owned by different owners. Half-duplexes can sit atop one another and be connected by stairs or be side by side and separated by a common wall.

Pros And Cons Of Owning A Duplex

There are advantages and disadvantages to being a homeowner and owning this type of home. It’s important to look at both sides of owning a duplex prior to making a decision about the type of home you want to own.

Pros

Some potential benefits of owning a duplex include:

• Mortgage help/rental income: Owning a duplex means having both a primary residence and an investment property because you purchase two separate residences. It can provide you with a revenue stream to help you pay off your mortgage faster.
• Potential tax breaks: If you rent out the other half of the duplex, you may be able to write off a portion of your property taxes, mortgage interest and maintenance costs for the rental unit.
• Start a real estate investment portfolio: As you make payments on your duplex, you continue to build equity. It can help you purchase more properties if you ever decide to move out, giving you two revenue streams from both sides of the duplex. You may also continue to purchase more duplex units later on, solely for investment purposes.
• Can help you downsize: If you want to move from a single-family home to a smaller space. A duplex could be a great option to downsize into. For example, you may find a duplex with a smaller square footage and a smaller yard to care for.
• Fewer neighbors than an apartment: Duplexes contain fewer neighbors than apartment buildings, which can be good if you prefer having fewer people living in the same dwelling as you.

Cons

The potential cons of owning a duplex may include:

• Shared space: You'll have to share space with another individual or family on the other side of the duplex, including a wall. In addition, the washer and dryer may be in a shared space in the basement. You'll also share the driveway and all outdoor areas with other tenants.
• Responsibility for repairs or renovations: Being a landlord includes keeping repairs up to code and purchasing landlord insurance.
• Potential for problematic tenants: As a landlord, you'll collect a rent check – the biggest perk. However, it may not be smooth sailing all the time. You may end up as the recipient of a whole host of other issues, too, such as destructive tenants, tenants who don't pay up every month, and more.
• Limited community: A duplex doesn't offer as large of a community as you would have access to with an apartment complex. If you want to live in a busy place with many tenants, an apartment may be your best bet.
• No amenities: Duplex dwellers don't get access to the same amenities that apartment owners get, such as swimming pools, fitness centers, community rooms and other perks.

Duplex FAQs

Read through the following frequently asked questions about duplexes to help you make a decision about whether they're right for you.

Is a duplex the same as a condo?

A duplex is not the same as a condo. A condo is a single unit connected to at least one other unit, while a duplex consists of two housing units joined together by shared walls. You typically own your walls inside the building in a condo. You may also have fewer responsibilities with a condo because a homeowners association (HOA) usually takes care of your yard and other common spaces.

Duplex owners typically don't pay for an HOA and maintain the exterior of their property, such as trimming their own trees.

What loan do I need for a duplex?

You can use several types of loans to purchase a duplex. For example, you may use a conventional loan, which is not backed by the government.

You may also consider an FHA loan; a loan insured by the Federal Housing Administration (FHA). The FHA is an organization under the jurisdiction of the Department of Housing and Urban Development (HUD). Individuals can get an FHA loan with a low down payment option and less stringent credit requirements.

If you are a military member, you may qualify for a VA loan through the U.S. Department of Veterans Affairs. If you qualify as a military or veteran member, veterans can take advantage of no down payment and less stringent requirements.

There may be other loan options as well – check with your lender for more information.

Should I buy a duplex house?

There's no one answer to this question because it depends on your preferences, requirements and other factors. Consider the pros and cons of purchasing a duplex before you start your home buying journey.

In addition, consider getting preapproved. You provide your lender with documentation so your lender can look at your income, assets and credit score. A preapproval helps you know how much house you can afford and your potential interest rate.

The Bottom Line

Now that you know the answer to "What is a duplex house?" – is a duplex right for you?

Duplexes are multifamily properties joined together, usually side by side, with separate entrances. They differ from apartments, townhouses and condos based on the number of units and where the living area is situated.

Duplexes can be great home choices because of their versatility. However, do your research and consider your needs before investing in one.

Talk with a Home Loan Expert if you’re ready to get started on the home buying process and determine whether you should purchase this type of property.