Should You Convert a Residential Space Into an Office?

Comfortable and affordable office space is hard to come by in many major cities. Many successful companies often work from converted homes. However, choosing to convert residential space into offices comes with unique benefits and challenges for entrepreneurs. Sounds like a good fit for your business? Prep to tackle these common issues that arise in home-to-office conversions.

Why choose a convertible space?

Business owners convert residential properties into office or retail space for many different reasons.


For companies that count on-foot traffic or easy access to specific areas, location may be key. These businesses don’t mind converting a property to stake a claim to a desirable neighborhood. An ideal location can also help attract young talent.


Office space can be expensive per square foot or require long-term commitments. It may be more affordable to rent out a house or apartment for your business, especially if you find a landlord that offers flexible leases. Here’s a quick example: In Cleveland, the average rental cost for retail space was $12.13 per square foot in 2017. The average Cleveland three bedroom home, however, costs $1,180 per month for 1,282 square feet. If you can find a residential space with flexible zoning, your monthly rent would be much lower.


Forget a conference room; meetings can take place around the kitchen island. For companies looking to distance themselves from a corporate feel, a converted house may have the casual, collaborative atmosphere you’re looking for.

5 common issues to keep in mind

You need to have a clear understanding as to what converting a residential to commercial space entails. Here are five issues to keep in mind if you want to transform a space from home to office.


Before you start planning company cookouts in the new backyard, make sure you’re legally allowed to operate a business in the space. Residential zoning may prevent you from operating a business that hosts clients or draws significant foot traffic. If you’re unsure whether your business meets the zoning requirements, contact your local government agencies before you sign anything.


Most office spaces have security measures to keep companies’ information and materials safe. Call in a trusted security company to discuss the kind of work your business does and what kind of security solutions they can offer. Don’t leave this item until the last minute; you may need to make changes to the building or layout to protect your property, so prioritize your security needs from the start.


It may take a little work to turn your new building into functional office space. Whether you’re knocking down walls for an open-concept communal feel or dividing up rooms into private offices, turning living space into working space may be costly and time-consuming. Check to see if you need to obtain permits for the work you’re doing. According to the Houston Chronicle, the average cost to renovate an office space is about $200 per square foot. Expect higher rates for a residential-to-commercial conversion.


Your company may want to stay away from that “office feel,” but a few adjustments will make your office an easy, comfortable place to work. Designate or create some private spaces for confidential conversations and meetings, and don’t forget a color scheme. You can still have an eclectic look, but a loose design scheme helps your place of business seem cohesive and professional.

Comfort and Convenience.

Make sure your newly converted space can support your employees day-to-day needs. Ensure that the home is properly ventilated, and that the heating and cooling system can support any additional strain (due to multiple computers and high occupancy). And don’t forget parking. Whether you obtain permits or pave a parking lot just for your staff, your neighbors and employees will appreciate your consideration.

The ideal office space will foster collaboration and creativity, and it should be a nice place for your employees to come to work each day. If you have the budget for the required renovations and changes, go for it. Converting a residential space into commercial space may the perfect solution for your small business.

Robert Kociecki is a real estate industry expert. He serves as the Senior Vice President of Property Management and Renovation at Altisource. Altisource and its affiliates provide real estate services for consumers and investors. Visit owners.comwhere home buying and selling is made simple.