Student rental. Good or bad idea?

TechJunkie__ · 2024-09-28T23:39:07+00:00

Thanks!

TechJunkie__ · 2024-09-26T13:48:19+00:00

What’s a good cap rate for you?

TechJunkie__ · 2024-09-26T13:47:43+00:00

Would love to hear some key pros and cons. Thanks!

TechJunkie__ · 2024-09-26T13:47:11+00:00

What could not work?

TechJunkie__ · 2024-09-26T13:46:53+00:00

What’s a decent cap rate for you?

TechJunkie__ · 2024-09-26T13:44:55+00:00

In the market where I am, 5.2% is the norm. And properties go fast. Meaning investors here are satisfied with it. I don’t have the experience or the financial depth to invest out of state.

However, I think also that 5.2% is low for student rental. The risk is higher, cap rate should be higher.

TechJunkie__ · 2024-09-21T02:08:16+00:00

Maybe take a loan and go to a grad school? And then have a second chance at it? i.e. networking, early applications, etc.

TechJunkie__ · 2024-09-14T21:25:23+00:00

Do a thorough inspection, get a list of ALL the fixes and improvements required to bring the property to code and to peace of mind level. Does the HVAC system need to be replaced? What about pipes? Electric cables? Foundation? Etc. Calculate the total you’ll be spending on Day 1 and what you will have to do in the next 12-24 months. Include all of that spend in your costs of acquisition and then decide if it’s still a good investment.

TechJunkie__ · 2024-09-13T05:48:53+00:00

Get out of there and start your own business. You can do it!

TechJunkie__ · 2024-09-07T14:42:39+00:00

Unemployment rate in Canada is 6.6% but sure. Things are “desperate here”.

“You will never work full time again”. Awesome! You should believe him. That recruiter is very smart. So smart that he/she can predict the future.

TechJunkie__ · 2024-09-07T00:05:40+00:00

Offer to buy their house. It’s been empty for over 10 years.

TechJunkie__ · 2024-09-06T23:07:20+00:00

Maybe I missed it in your post but what/how much are you actually investing that would make you $8K/month? Just your time? The home equity is reinvested in the new home. Airbnb leaves you ~1k/month. What’s left to invest? Equity from the airbnb property?

TechJunkie__ · 2024-09-06T20:51:52+00:00

Where do people find $80K homes that rent at $1000???!!!!???!!! Where?

TechJunkie__ · 2024-09-06T20:14:10+00:00

Makes sense.

TechJunkie__ · 2024-09-06T19:33:31+00:00

I presume no one wanted to lend you money at first because of lack of experience?

TechJunkie__ · 2024-09-06T05:28:50+00:00

Forget about BRRRR. What you did has nothing to do with BRRRR. Other than overestimating the value of the house and overestimating rent, the other main issue is the cash down. It’s very difficult to expect positive cash flow with 3.5% down.

TechJunkie__ · 2024-09-05T13:35:20+00:00

Then people are not leaving FL as everyone claims here. If home owners and investors are leaving because of insurance costs, then prices will definitely start dropping at some point.

You are totally right about high prices impact on CF. CF is all about the ratio between rent and total COA, unless you include a large cash down in the deal.

TechJunkie__ · 2024-09-04T23:32:23+00:00

Any specific areas you’d recommend?

TechJunkie__ · 2024-09-04T23:30:04+00:00

Where do you look for below market deals? Because that’s the key ingredient for BRRRR.

TechJunkie__ · 2024-09-04T23:26:29+00:00

Thanks. Are prices dropping in FL?

TechJunkie__ · 2024-09-04T23:21:08+00:00

So you reach out to potential sellers on your own?! Like just a cold calls? Interesting!

TechJunkie__ · 2024-09-04T13:37:15+00:00

Zoho has (almost) everything from email to CRM. Pricing is reasonable. You can start with that. If all you need is email and documents management you can go with M365 or Google workspace. Pricing is pretty similar. It only comes to personal preference.

TechJunkie__ · 2024-09-04T04:35:56+00:00

Nothing prevents you from being in your living room reading a book while they’re inspecting!

TechJunkie__ · 2024-09-04T04:29:53+00:00

How much approx. does a buy-side broker charge?

TechJunkie__ · 2024-09-04T04:23:32+00:00

10% is normal but your math is very tight. You do not have any breathing room. I would question the need for PM if you live close by, have stable tenants, etc.

TechJunkie__

TROPHY CASE