What Is a Duplex Property?

Definition & Examples of Duplex Properties

Neighbours chatting outside duplex
Photo: PhotoAlto/Ale Ventura / Getty Images

A duplex property, or duplex for short, is a single residence that contains two living units.

Learn about how a duplex property is typically used along with its pros and cons as a real estate investment.

What Is a Duplex Property?

A duplex property is a type of multifamily property containing two living units located within the same structure and on the same lot. Although the units may be detached, most are attached, either horizontally such that the units are side by side and share a common wall, or vertically such that they're on separate floors and share a common ceiling.

  • Alternate name: duplex

How a Duplex Property Works

Traditionally, a duplex is owned and maintained by a single owner but inhabited by two households—one in each living unit. There are three potential duplex living arrangements:

  • Live in one and rent out the other: In this common scenario, the duplex property owner lives in one of the units and rents out the other to someone inside or outside of their family. For example, a young professional might occupy a single unit and rent out the other to a friend or colleague, or a senior might rent it out to an adult child who serves as a caretaker. The second unit acts as an investment property, making money for the owner that they can use to offset the potential mortgage and maintenance costs.
  • Live elsewhere and rent out both units: An owner who already has a primary residence can purchase a duplex and rent out both units while they continue to live in their separate residence. This presents a good option for a financially established homeowner who is primarily interested in a duplex as an investment property.
  • Live in both units: Although less common, a duplex owner with a large or multigenerational family may choose not to rent out either unit and instead buy a unit with the aim of occupying both. If a homeowner is transitioning to a multigenerational living arrangement, for example, they might live with their spouse and children in one unit while their older parents live in the other unit.

Pros and Cons of a Duplex Property

The advantages and disadvantages of purchasing a duplex include:

  • Cheaper than single-family homes

  • Rental income

  • Easy access to investment property

  • Tax benefits

  • Ongoing maintenance costs

  • Vacant second unit

  • Irresponsible or incompatible tenants

  • Hard-to-get, costly second mortgage

Pros Explained

There are several advantages of buying a duplex:

  • Cheaper than single-family homes: You'll often pay less for a duplex than for a single-family home. This may make a duplex property a good option for a cash-strapped or first-time homebuyer.
  • Rental income: A significant benefit of buying a duplex and renting out one or both units is the opportunity to make money—potentially a lot of it if the duplex is based in a tourist-friendly or otherwise desirable area. You can use the monthly rent check from your neighbor to offset the costs of your mortgage payment and home maintenance or potentially live mortgage-free. The rental income may allow retirees to meet essential expenses in their golden years.
  • Easy access to investment property: If you plan to live in one of the units of your duplex and rent out the other, you'll be in close proximity to the second unit should you need to tend to issues that arise with the property or the tenant. There's no need to drive across town to address the matter.
  • Tax benefits: You may be eligible for tax deductions on mortgage interest and other rental expenses for your duplex. But if you use the duplex for both rental and personal purposes, you'll typically need to divide the expenses based on the number of days you used them for each purpose, which can limit your rental expense deduction.


A duplex, like other dwellings, is considered to be used as a residence if you use it for personal purposes for the greater of 14 days per year or 10% of the total number of days you rent it out to others at a fair rental price. If you use a duplex as a residence and rent it out for less than 15 days per year, you can't deduct any expenses as rental expenses.

Cons Explained

Drawbacks of duplex ownership include:

  • Ongoing maintenance costs: As with any home you own, you'll need to cover the expenses of repairing and maintaining the duplex. But when it comes to a duplex, these costs can become unmanageable if the tenant is particularly demanding.
  • Vacant second unit: Even if you diligently maintain your duplex property, the risk remains that you will be unable to fill the second unit with a tenant. If it remains vacant for a prolonged period of time, you miss out on help with your mortgage payment and maintenance and defeat the purpose of buying a duplex as an investment property.
  • Irresponsible or incompatible tenants: Whether you and your tenant don't get along or have similar lifestyles, or your tenant is neglectful and frequently damages the property, it can make a duplex living arrangement hard to bear.
  • Hard-to-get, costly second mortgage: If you already have a mortgage for your primary residence, it may be harder to take out a second one for a duplex. You may get a more conservative loan from a lender or be on the hook for a higher down payment because of the higher risk involved with carrying two mortgages at once. You can also expect a higher interest rate on that second mortgage.


Second mortgage interest rates are typically a quarter to half a point higher than interest rates on first mortgages.

How to Get a Duplex Property

If a duplex is right for you, and you plan to obtain financing to buy the property, shop around for a loan. Consider getting preapproved for a mortgage to determine how much you can afford to borrow for a duplex. Also, have a down payment ready.

Think about the desired location and features you want in a duplex, such as the architecture and the number of bedrooms and bathrooms. Then, consult a real estate agent to find a duplex that meets your needs. The agent will guide you in the process of making an offer on and closing on the duplex.

If you intend to rent out one or both units, familiarize yourself with local regulations pertaining to landlord responsibilities. Similarly, research rents in your area and set a fair rent price to ensure that the unit remains occupied and you maximize the return on your investment.

  • A duplex property is a residence with two living units.
  • Duplexes usually have one owner but may be occupied by two households.
  • Owners can live in one unit and rent the other out, rent out both units, or occupy both units.
  • Duplex properties offer rental income and tax benefits but require ongoing maintenance and may be difficult and costly to get with a second mortgage.
  • Investors can buy a duplex with the help of a real estate agent.
Was this page helpful?
The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. American Family Insurance. "Condos vs. Duplexes." Accessed Aug. 26, 2020.

  2. IRS. "Topic No. 415 Renting Residential and Vacation Property." Accessed Aug. 26, 2020.

  3. Bank of America. "Tips for Buying a Second Home." Accessed Aug. 26, 2020.

  4. Chase. "Decide If You Should Buy a Second Home (And Get a Second Mortgage)." Accessed Aug. 26, 2020.

Related Articles