My DH had a house like that growing up. He and his brother were squished in upstairs until they were teens and then they were allowed to move downstairs. In the meantime downstairs was used as a toy/games room and guest room.
On the other side, my brothers and I had bedrooms downstairs, and mum and dad upstairs, but the staircase was internal. Even then when I was little it spooked me a bit.
I grew up this way, it was a totally separate duplex with upstairs on the street level and mum and dad downstairs on the backyard level. It made it very easy to slip out at night as teenagers! Depending on your security it would be ok, we had an intercom next to our beds if we needed mum or dad we'd just call. Different times though, I don't think I'd be happy with it now to be honest.
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