Guides · Investing
Buy a licensed adult family home, or convert a house?
These are two different purchases, not two prices for the same thing. A licensed operating home costs more and can earn sooner. An ordinary house costs less and takes much longer before a single resident moves in. Pick the one that matches your money and your patience, not the one with the better headline price.
Two routes#
The first route is to buy a home that is already licensed and running. Residents live there. Staff work there. There is income on day one, or close to it.
The second is to buy an ordinary house and turn it into an adult family home yourself. No residents, no license, no income. Just a building with the right bones.
People often compare the two on price. That is the wrong comparison. You are not buying the same thing twice at different prices. You are choosing between a business and a project.
The four things that actually differ#
Everything else is detail. These four decide it.
- PriceA licensed home costs more, and the gap is not the building. You are paying for the license, the residents, the staff and the income. An ordinary house is priced as a house.
- Time before money comes inA licensed home can earn soon after you take over, though not immediately, because the license does not transfer with the house. A conversion earns nothing until the work is done and your license is issued. Plan that in months, not weeks.
- How you pay for itA licensed operating home is a business purchase, so most lenders move it to their commercial side. An ordinary house you intend to live in may still take a normal home loan. That difference can change your down payment more than the price does.
- What can go wrongWith a licensed home, the risks are inherited: residents may leave, staff may leave, past inspection findings come with it. With a conversion, the risks are ahead of you: permits, building work, timeline, and a long stretch with no income.
Rules, programs and costs change, and they differ between Seattle and each surrounding city. Figures on this page are dated where they appear. Confirm anything specific with the relevant city or agency before you rely on it.
Have an address in mind already?
Book a call and I'll tell you what I'd doWhat makes a house worth converting#
Not every house can become an adult family home, and the ones that can are not random.
One thing matters more than everything else: the house should be on one level. No stairs to the door. No stairs between a bedroom and a bathroom.
That is not a preference. Many residents have trouble walking, and a good number arrive after a fall. A single level is the thing families are really choosing. It is also the hardest thing to add later, which is why it is the first filter I use when I search for you.
After that: enough bedrooms, more than one bathroom, a lot with room to park, and doorways wide enough to use. Those can be worked with. Stairs mostly cannot.
Sources
- Homes for sale, sorted by licensed and convertible, My adult family home search
- How to open an adult family home in Washington, Every step from training to license
- Turning a house into an adult family home, What the house itself needs
What you inherit with a licensed home#
Buying a running home means buying its history too. Some of that is worth paying for. Some of it you need to see first.
You inherit the residents, if they stay. You inherit the staff, if they stay. You inherit a reputation with the families and the case managers who send referrals.
You also inherit the inspection record. That is public, and it is the first thing to look at.
And you do not inherit the license. You apply for your own. That is true on both routes, and it surprises people on this one.
Sources
- What to check before you buy an operating home, The due diligence list
- How to pay for it, Loan routes and the license gap
Which one I would point you at#
If you need income reasonably soon, and you can raise the larger amount, buy a licensed home. You are paying for a head start and that is a real thing to buy.
If you have time, less cash, and you want the home set up your way, convert. You will wait a long while for the first resident. The price you pay for that wait is a lower purchase price and a home built to suit you.
If you have never worked in care, the licensed route is usually kinder, but only when staff are staying. A licensed home with no staff is just an expensive house.
And if you are not sure, say so early. The two searches look for completely different houses, so it is worth deciding before we start looking rather than after.
What I do, and what I do not#
I represent you on the house. That is a Washington real estate purchase, and it is my side of it.
If the home is already licensed and running, there is a second agreement for the business. The name, the phone number, the furnishings, the goodwill. That one is drafted by a business broker or an attorney, not on a real estate form.
My job there is coordination. I keep the two agreements, their deadlines and your license application moving on the same calendar.
I am not a licensing consultant, an accountant, a lender or an attorney. The department decides your license, not me.
Sources
- Buying the business as well as the house, How the two agreements fit together
Common questions#
Which one is cheaper?
The house is cheaper to buy. The licensed home is cheaper to start earning from. Which one costs you less overall depends on how long you can go without income while you convert.
Does the license come with the home if I buy a licensed one?
No. You apply for your own through a change of ownership. You have to qualify, and it takes time. Expect a period where you own the home and cannot yet operate it.
What kind of house converts well?
A single-story house, first and foremost. No stairs to the entry and none between a bedroom and a bathroom. Then enough bedrooms, more than one bathroom, parking, and doorways you can get a walker through.
Can I get a normal mortgage either way?
Sometimes on a conversion, if you are buying an ordinary house and will live in it. Rarely on a licensed operating home, because lenders treat that as a business purchase. Ask a lender before you plan around it.
Can I change my mind partway?
Up to a point. The two searches look for different houses, so switching usually means starting the search again. It is cheaper to decide first, even roughly.
Related guides
- Buying an adult family home in Washington: the buyer's guide
- How to open an adult family home in Washington
- What to check before you buy an adult family home
