First deal ever! I think I’ve found a good one!

4 Replies

Entering into my first rental property. I will be purchasing the property for $65,000 with 20% down. It is a 2 story house built in 1928 4/2. Each room rents for $300 a month plus utilities. They are all 4 currently rented. It’s in a college town & is probably 300 yards from the college lots of potential to keep rented. Also has a dinning room not being used that I could turn into a fifth bedroom & rent for another $300. Current owner has had house completely re wired & all new plumbing has been done. It’s needs some more improvements down the road but I think it’s a good deal & a good ROI right now. Any advice would be greatly appreciated. My rough numbers show a $350 cash flow.

What are the market rents for the area.

What are the local building codes regarding th eallowable number of unrelated tennats in a single property.

There aren’t any rules off allowable occupancy. It’s just has rules on what size the rooms have to be that are being slept in. There are rentals all in this area with lots of different prices.

A couple things to look into (and this is by far not a complete list):

Check zoning to make sure your rental is legal. can you rent out as individual rooms? and is there a limit to the number of occupants?  Do you need a rental permit?  What about parking?  

How are the utilities bills split? 

12 month leases, or 9 month?

Is it considered "student housing"?  If so, do you need to / can you register with the school to advertise for tenants?

Also might be a good idea to track down other owners in the area to ask how their experience has been as an owner.  Sometimes college towns are rad, sometimes they really, really, really suck - especially around football and tailgating season...

They do 12 month leases & the tenants currently renting have 3 more years of school.

I’m buying house from a pastor that leads the Baptist Student Ministry at the college & the tenants are usually students that attend the BSM so they aren’t into partying or doing crazy things at the house he said. Also if I ever have rooms available he’ll help me find new tenants.

They split the utilities.

It has a driveway that a couple of cars can park in rest park on street. I have enough room next to driveway & carport to make a parking spot so they don’t have to be on street.

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