Renovating Heights House – can I make it a duplex?

My wife and I just purchased our first home in Woodland Heights. It was vacant for years and not in livable condition, we have finished gutting the inside and currently doing foundation work. We now think we want to split it into two living spaces – upstairs and downstairs – and rent out the second unit. I know there are limitations to what is allowed, but I don’t see how this would be much different than the garage apartments that many people in the area rent out. I don’t think the historical society is a problem because we are not adding anything exterior except a door in the back (maybe a side dormer – which I think would require us to deal with the historical society).

Does anyone have any experience that can shed some light on this? Anything I should know?