Can You Build a Business on Residential Property​?

Many people who aspire to be entrepreneurs ask themselves whether their living room is a good place to serve as a headquarters. Setting up business from your house seems like a good idea because you can save money on travel expenses, overheads, and you will enjoy flexibility. 

As property managers, including those focused on property management in Norman, OK, we get requests from clients who seek clarification on residential business laws regularly. It is important to understand how to start a business in your home successfully while complying with the local rules and regulations.

Complying with Zoning Laws and HOA Rules

First, you need to know the zoning laws for home-based businesses. Cities create commercial and residential zones in order to prevent disturbances caused by industrial or other businesses. Operating your business in a residential area without knowing the applicable laws can make you pay fines.

Understanding Homeowners Association Covenants

In addition to city regulations, you need to look into the rules established by your Homeowners Association. In many cases, HOAs create stricter rules than the city itself, and they could forbid you from installing signs, hosting clients, and even forbid some businesses in general. We always advise our clients to study their property deed and homeowner association regulations.

Choosing the Right Type of Venture for Your Home

All types of business activities are not appropriate in a residential zone. The best type of business to engage in from your home is usually low-profile and does not disturb the neighborhood.

Engaging in Online or Virtual Businesses

The safest businesses you can run from your house are online businesses, such as freelance writing, digital marketing, and other businesses. These types of businesses have no physical presence and usually don't require any equipment that would produce noise or attract delivery trucks. From experience, we have seen that municipalities never object to businesses that occur entirely virtually.

Engaging in Physical Businesses



There are also businesses that can be conducted physically but still are okay within a residential zone. Tutoring private clients, providing boutique accounting services, and doing small crafts at home are the types of business operations allowed in a residential area. 

However, the important point here is that your operation shouldn't require a large amount of visitors. If you are asking, can you build a business on residential property? We are happy to assist you at First Class Property Solutions with assessing whether your business is suitable for conducting in a residential zone, especially when renting. 

Obtaining Necessary Permits and Licenses

While your neighborhood allows you to conduct your business in a residential home, this doesn't mean that you should skip the process of registering your business.

Typically, the homeowner should obtain two documents in order to prove that they comply with zoning laws. First, you need to obtain a home occupation permit, which confirms that your business does not exceed the allowed floor space ratio or storage equipment regulations. Also, we advise our clients to register their local business license. We can provide you with detailed information about necessary permits and licenses for your case.

FAQs

Is My Landlord Allowed To Evict Me Because Of A Business In My Apartment?

Landlords can evict tenants who violate terms stated in their leasing agreements. Typically, residential leases say that the building is solely intended for living purposes, which means that if your business violates this clause, your landlord can evict you from the property.

Can I Hire Employees For My Business In The Home?

This question is quite tricky, as hiring staff is prohibited by many zoning laws because it brings additional cars to the residential area, which leads to parking problems. Thus, you need to consult the municipal code to find out what kinds of assistants can or cannot work in your building.

Are There Any Tax Breaks For Home Businesses?

Yes, there are some ways of lowering your taxes through home businesses. You can deduct a part of your mortgage interest payments, utility bills, and maintenance from your business income based on your square feet of the property occupied by your business. Consult a tax specialist about this matter.

Taking the Next Step Toward Home Business Establishment

It seems to be an easy task - just plug a computer into the wall socket and run your business! However, as experienced property managers, we know that it takes a lot of time and effort to conduct a business successfully while complying with the local rules, including understanding your business rights on residential property. 

Thousands of successful companies are operating in residential areas right now, and the main reason for this is good preparation. We can help you with establishing a legal business from your residence. Contact us now as a landlord or tenant and learn more about this process!