What is a Duplex? Definition, Cost, Types, and Pros & Cons

A duplex is made up of two separate living units on one shared piece of land. It combines the best of both worlds: the comfort of living in a single-family home and renting out the other to earn additional income. As per the Zillow Consumer Housing Trend Report 2021, about 2% of homeowners said they own a duplex or triplex, and 5% of renters have moved to a duplex or triplex in the past year.

If you have plans to buy or rent a duplex, read this article to understand what is a duplex, its pros and cons, and different types.

What is a Duplex House?: Key Features

A duplex is a multi-family house that sits on shared land with two units separated by walls or floors. The units can be side by side, as we see in townhouses, or top to one another, similar to apartments. 

This type of house may have a shared area, such as a backyard or driveway, that the renters can also use. These dwellings are most common in the largely populated areas like large cities and college towns.

Here are the key features to better understand what does a duplex look like: 

• Separate Entrance and Living Space

  Units generally have separate entrances and do not have shared hallways. Residents access their homes through different private exterior doors. Each side or floor has a separate living space with a kitchen, living room, bathroom, and bedrooms.

• Shared Structural Elements

  The occupants often share the walls, roof, or foundation of the house. It varies by layout, as the side-by-side units share the central wall whereas the stacked units share ceilings and floors. This affects the privacy, noise, and maintenance needs in this residential option.

• Ownership Models

  Generally, duplexes are owned by a single entity or landlord who rents out one or both units. The owner is responsible for maintenance of the entire building, while tenants are responsible for the individual units. It can also have split ownership where two parties share ownership of the entire property. Each party has a right to each unit under an agreement.

• Separate Utilities

  Depending on how the property is constructed, it can be separately metered or shared. In the separate set-up, each unit can manage its own utility accounts, which makes the billing simpler for electricity, water, and gas. On the other hand, in the shared system, costs are managed by the owner or lease agreements. 

Also Read: The Condo vs Coop Analysis with Ownership Structures, Governance & Rules, Amenities, Costs & More!

What is Duplex House Cost in the USA?

What’s a duplex cost in the USA? The cost of buying and renting it differs significantly based on location, size, and amenities. Let’s see the approximate cost:

Approximate Purchase Cost	$350,000 to $700,000 ($150 and $300 per square foot)
Approximate Rent Cost	$1,650 to $1,850 per month

Pros and Cons of a Duplex House

Duplex houses are undoubtedly a strategic investment and benefit both the owners and renters. It provides rental income, increased privacy, and family flexibility. However, it has some disadvantages as well, like maintenance responsibilities for the landowner and a high down payment. 

Take a look below to know what are duplexes pros and cons:

Pros

• Rental Income: Offers the opportunity to earn additional rental income from the second unit. This can be helpful in covering monthly mortgage payments and other housing expenses, making ownership easier.
• Enhanced Privacy: This housing type generally offers more privacy to the tenants compared to a condo, townhouse and apartment.
• Shared Expenses: Housing expenses like property tax and maintenance costs are often shared between the owner and tenants. It reduces the financial burden on both.
• Potential for Appreciation: Just like other real estate investments, a duplex has the potential to increase its value and build equity with time. 
• Family Flexibility: The extra unit is perfect for extended families, adult children, and aging parents.
• Outdoor Space: It often comes with a yard or garden, which makes it ideal for gardening, relaxation, and play. 
• Tax and Financing: Owners may benefit from the tax deductions if renting out one or both units.

Cons

• Landlord Responsibilities: It is typically the landlord’s responsibility to manage the tenant relationship and handle maintenance and repairs, which is very time-consuming.
• Shared Space: Inhabitants usually share the walls or ceiling in the building. This may lead to noise transmission and disturbance.
• Cost: While owners can benefit from the rental income, buying a duplex home takes a large sum as a down payment. As a result, the financing cost is usually higher than buying a single-family home.

Next Read: What are Home Renovation Costs? Simple Techniques to Make it Affordable & Hassle-Free!

Types of Duplex Houses

Duplex homes come in many different sizes and structures, offering distinct features and advantages. The types of houses include ground duplex house, standard duplex house, low-rise duplex house, and half duplex.

Ground Duplex House 

A ground duplex or garden duplex has one unit on the ground floor that faces the garden, yard, or patio. In this, the upper floor usually has the kitchen and living area.

Standard Duplex House 

The standard duplex is the most common type, having two separate living units side by side or on top of each other. In this, the lower floor generally has a kitchen and living room, while the upper floor consists of bedrooms and a children’s room.

Low Rise Duplex House 

This type is usually low in height and has no more than three stories. It may look similar to the standard duplex house, but it has fewer units. This poses a challenge for architects to make the most of the limited space available.

Half Duplex

A half duplex or semi-detached house consists of two separate residences with a shared wall. Each unit has its own entrance and tends to be more budget-friendly than the detached homes.

How is a Duplex House Different from Other Types of Houses?

Many people confuse duplexes with other types of houses like apartments, condos, twin homes, and townhouses. However, they are all different based on factors like ownership and number of units. Take a look below to see how does a duplex work compared to other types of homes:

Duplex Vs. Apartment 

A duplex is a residential house that has separate living spaces and entrances. On the other hand, an apartment is a single living unit within a large building. It has shared entrances, a common outdoor space, and amenities.

Duplex Vs. Condo 

In a duplex, occupants own their separate units with different entrances. While in a condo, people own different units in the larger building complex, where they only own the interior area and share ownership of the common space. 

Duplex Vs. Twin Home

The difference between a duplex and a twin home is in land ownership and zoning. The duplex is the multi-family housing on a single lot, while a twin home consists of two separate single-family homes on distinct lots.

Duplex Vs. Townhouse 

A duplex is a single building divided into two similar units, usually owned by one person. On the other hand, a townhouse is one of the many conjoined, individually owned homes in a row or large community.

You May Also Read: Renovation Vs Remodel: Difference, Cost Breakdown, Permit Requirements, and More

How to Buy a Duplex?: Detailed Steps

Buying a duplex is similar to buying a single-family house. However, finding the right duplex and tenants can be a tricky task. Let’s see the steps for buying this house:

• Get Preapproval: The first and foremost step of buying a house is getting preapproved for a mortgage. As the lender preapproves you for the loan, you will receive a letter that will state how much you can borrow to buy the property. 
• Find the Right Duplex: Finding the right duplex can be challenging because of limited property options available in the market. Explore the online platforms and ask your agent to provide you with comparable rental properties in the area. So you can get the idea of the property’s income potential.
• Finance the Property: To buy one of the units, you can apply for FHA, VA, or conventional loans. FHA loans benefit those who can’t afford a large down payment. People eligible for a VA loan can qualify for a zero-down-payment loan. If you don’t qualify for any of these loans, you have to pay a high down payment and interest rates.
• Move into the Home: Once the loan closes, you can get the keys to your new home and move into it. 
• Rent the Property: If you want to rent one or both units, you can talk to the real estate agent to help you find the right tenants. It will bring additional rental income.

Bottomline

Now that you have understood what is a duplex, you can make informed decisions regarding its purchase and rental. It is considered a smart investment to buy this housing type as it offers two living units. Owners often live in one and rent the other for additional income.

Once you begin your search for the right home, assess first how much you can spend on buying it. Also, explore the financing options like Federal Housing Administration (FHA) loans and conventional mortgages. 

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