Buying a duplex and living in one side while renting the other is an idea that comes up more and more in my conversations with buyers. It can help with the mortgage, build equity, and give you a foot in the door of real estate ownership. It also turns you into a landlord with a neighbour on the other side of the wall. Here is a practical look at what living in your own duplex involves on the Island.

Why owner-occupiers like duplexes

The main appeal is simple: rent from the other unit can help cover your costs. For a first-time buyer, a young family or someone semi-retired, that extra income can make a home possible that otherwise would not be.

There are other upsides too. You are on site, so you notice problems quickly. You choose your tenant. And down the road, the other unit can become a place for a family member, a caregiver or adult children.

How property tax treatment can work

PEI's owner-occupied assessment program caps yearly increases on the taxable value of an owner-occupied home. In a building with more than one dwelling unit, PEI's Real Property Tax Act looks only at the unit the owner actually occupies when deciding the owner-occupied tax credit. The rented side is treated separately.

The Real Property Tax Act also includes a separate tax credit for long-term rental units in multi-unit buildings that meet specific conditions, such as being rented long-term for at least six months of the year. The rules have dates and conditions attached, so look at the exact wording or check with the Province's property tax staff before relying on any credit.

One more detail: under the current definition, short rentals of under 30 days in any part of an owner-occupied home can affect its owner-occupied status. If you are thinking of using the other unit as a short-term rental, check the rules first.

Financing basics

Lenders treat an owner-occupied duplex differently from a pure investment property. Many will consider some of the expected rental income when assessing what you can afford. Down payment requirements and how rental income is counted vary, so talk to a mortgage professional early. Use our mortgage calculator to rough out payments, then confirm with your lender.

Which side should you live in?

It sounds like a small question, but it matters. Consider:

• Which unit has the better layout, light or yard for you
• Which unit would rent more easily, and for how much
• Where the shared systems are, like the electrical panels, water heater or laundry
• Noise: who is above or beside whom

Some owners choose the smaller side to keep the higher rent coming in. Others want the nicer side because it is their home. Both are fine; just decide on purpose.

What to check before you buy

• Separate metering. Are power and heat separate for each unit? If not, how are costs shared?
• Existing leases. If there is a tenant, ask for the lease, the rent amount and the deposit details. You may be inheriting that arrangement.
• Fire separation and safety. Ask your home inspector to look closely at the separation between units, smoke alarms and exits.
• Permits and legal use. Make sure the building is recognized as a two-unit dwelling.
• Parking and snow. Two households means two sets of cars, and somebody has to clear the driveway.

Being a good landlord

Residential tenancies on PEI are governed by provincial rules. The Residential Tenancy Office handles landlord and tenant matters, and its orders can be appealed to the Island Regulatory and Appeals Commission (IRAC). Before you rent out the other unit, read up on your obligations around leases, deposits, rent increases and notice periods. Having clear expectations from the start keeps things friendly.

Living next to your tenant means the relationship is personal. Be clear, be fair and keep your boundaries. Many owner-occupiers find it works best to handle requests in writing, even when you see each other in the driveway every day.

Is it right for you?

A duplex is a great fit for people who are handy, organized and comfortable sharing a property. If you prefer total privacy, it may not be. For a broader view of rental property on the Island, my post on investing in PEI real estate covers the investor side.

Ready to look?

You can browse PEI duplexes and multi-unit homes to see what's available now. When something catches your eye, contact Jodi Bernard, CENTURY 21 Northumberland Realty, and we can talk through how it would work for you.

Ask people what they love about Prince County and the Confederation Trail comes up again and again. It runs right through both Kensington and Summerside, and for a lot of my clients, being able to walk out the door and onto the trail is a big part of why they chose their home. Here is what the trail looks like in this part of the Island and what to think about if trail access is on your wish list.

A quick bit of background

The Confederation Trail was built on the Island's old railway line after rail service ended in 1989. The main trail runs tip to tip from Tignish to Elmira, 273 km, and the total network including branch trails is 449 km, according to Tourism PEI. The surface is rolled stone dust, which makes it friendly for walking, running and cycling.

The trail is marked with distances from west to east, starting at 0 km in Tignish. On the official trail map, Summerside sits at km 109 and Kensington at km 123. That puts the two towns about 14 km apart along the trail.

The Kensington stretch

Kensington's railway heritage is easy to see. The trail guide notes the Kensington Rail Road Station as a stop along the way, along with Engine 1762, a diesel locomotive that arrived at the station in 1990. It is a nice landmark for a family walk, and it gives the town's trail section a real sense of place.

Heading east, the trail continues toward Freetown and Emerald, where a branch trail runs south to Borden-Carleton. Heading west, you are on your way to Summerside through farmland and small communities.

If you are drawn to the idea of walking to town for a coffee and walking home on the trail, have a look at Kensington homes for sale and filter by the streets closest to the old rail line.

The Summerside stretch

In Summerside, the trail brings you close to the downtown and the waterfront. The city's Baywalk, a 6.5 km waterfront boardwalk and cycling trail, connects to the Confederation Trail at several access points. That combination is a big draw. You can head out on the main trail, loop down to the harbour and come home along the water.

Between Summerside and the west, the trail passes Miscouche at km 101, home of the Acadian Museum. If you like the idea of a smaller community with the trail on your doorstep, Miscouche is worth a look.

What trail access means day to day

Clients who live close to the trail tell me they use it in all kinds of ways:

• A safe place for kids to learn to ride a bike away from traffic
• An easy daily dog walk
• Commuting by bike in the warmer months between nearby communities
• A flat, steady surface for runners and walkers of every age

Winter brings different conditions and uses on some sections, so check Tourism PEI or the Province for current trail guidance before you head out on skis or snowshoes.

Things to consider when buying near the trail

Being close to the trail is a plus for most buyers, but a few details are worth checking on any specific home:

• Privacy. A backyard that borders the trail will see foot and bike traffic. Some people love the friendly waves; others want a fence or a hedge.
• Access points. Living near the trail is not the same as having an easy way onto it. Find the closest official access.
• Seasonal rhythm. Ask neighbours how busy the section behind the house gets in summer compared with winter.
• Lot lines. The trail corridor is not part of your yard. A survey or a look at the property map will show exactly where your boundary sits.

Questions I hear from trail-loving buyers

"Can I bike to work?" In the warmer months, some people do ride between nearby communities, though most commuters still drive in winter. "Is it lit at night?" Generally, plan on daylight use and bring a light if you are out at dusk. "Will a trail-side lot hold its appeal?" Many buyers see trail access as a lifestyle bonus, so it is worth mentioning in a listing, but every home is valued on its own merits.

Find your spot near the trail

Whether you picture yourself in a Summerside neighbourhood a few blocks from the Baywalk or in a quieter spot in Kensington, I can help you narrow down homes with good trail access. You can browse Summerside homes for sale anytime, and when you are ready to see some in person, contact Jodi Bernard, CENTURY 21 Northumberland Realty.