Expert: Mike Fortunato - 4/5/2009

Question
I am looking at purchasing a 1975 built 12 unit apartment that sits in an area that has been re-zoned from multi unit to low density residential 4 years ago. I don't plan to rebuild but to use in existing form with upgrades, etc. However, from an investment and then resale perspective is it a bad idea, good idea, need more info(?) to purchase a multi unit that now sits in a low density residential area?

Answer
That property is probably grandfathered in to the previous zoning, so it probably won't become a problem in the future. the exception might be if you try to do any major alterations to the building, which could trigger the new zoning to come into effect. But if the investment is a good one on its own merits, the zoning change alone shouldn't adversely affect it (I would be more concerned if you bought low density properties, and had the area rezone to multifamily). Even still, a trip to the local planning department as part of your due diligence is in order, just to get a read from them regarding any potential problems (if any) they could foresee down the road.