Is it permissible to convert a prayer room (musalla) into residential rooms after preparing another prayer room nearby?

Prayer areas in homes, institutions, or companies, intended only for the residents or employees of that place and not open to all Muslims, do not take the ruling of a mosque. People in ancient times used to designate a place for prayer in their homes called "musalla al-bayt" (house prayer area) or "masjid al-bayt" (house mosque), and it did not have the well-known rulings of mosques. For instance, 'Itban ibn Malik asked the Prophet, peace be upon him, to pray in a place he could designate as a musalla in his house. Al-Hafiz Ibn Hajar said: "Designating a place in a house for prayer does not necessitate its endowment, even if it is called a mosque." Ibn Qudamah mentioned that a house mosque "does not have the rulings of a true mosque." And it is stated in "Al-Mawsu'ah al-Fiqhiyyah" (The Fiqh Encyclopedia): "A house mosque is not a mosque in reality or by ruling; it is permissible to change its purpose, and for a ritually impure person (junub) to sleep in it."

Therefore, this prayer area in the house does not take the ruling of a mosque, and there is no harm in converting it into living rooms. It is important to note that congregational prayer is obligatory in the mosque, and it is not permissible to pray it at home except with a valid excuse.