Most cities, villages, and townships have enacted zoning ordinances to determine whether an owner, tenant, or business is using the property as permitted by local law. Zoning ordinances also may address occupancy standards in addition to the occupancy standards in the local building code. It's your job to discover whether your unit complies with local regulations.
The letter and number zoning designations may differ in various communities, but classifications are similar, such as:
R-1: Single-family residential
R-2: Mixed residential use, which permits both single-family and multifamily buildings
B-2: Mixed business and residential use
Before you start remodeling your home for an apartment or purchase property that you can rent to tenants, it is absolutely essential that you go down to your local zoning department to find out what uses are permitted in the neighborhood. If you live in an R-1 zone, you will have to go before the zoning board of appeals to request a variance. If it's granted, the variance will allow you to construct that second unit and lease or rent it to tenants.
If you apply for a zoning variance, prior to the hearing you will have to submit a copy of your plan and diagrams of the work you want to do. You'll also have to pay a fee to the city. You can handle this yourself or have your builder or carpenter go with you.
Notices of the variance hearing are sent to neighbors in the immediate vicinity, as you may know if you've ever received such a notice. Neighbors might object to your request because they don't want increased traffic, parking problems, or possible noise problems. If the zoning board agrees with them, your variance may be denied.
Even if you find a building that already contains two or more units, check into how the property is zoned. You may discover that the zoning commission “grandfathered” the multifamily use into a single-family zone simply because the apartments were there before the zoning ordinance was written. Grandfather clauses sometimes restrict the special-use permit to the original property owner, or they may have expired if the building was vacant for a year or more. Don't purchase any property until you know what zone it's in and what uses are permitted under that zoning.