I am looking at a property that has the potential to cash flow really nicely if all three units are rented out. The only problem is that I'm not sure how I would get someone to rent out one of the units, let me explain.
The property lists as a single family home that has 5 beds and 4 baths. But in reality, it's a house (three bed two baths) and a property in the backyard that has an upstairs and downstairs that both have their own entrances and each have their own bedrooms, kitchens, and bathrooms, basically lofts. Each loft is currently rented on a month to month basis as the house is on the market, and the tenants are paying $600 a month. The house itself is where the current owners live but I could easily pull another $1000-$1200 out of it if I had renters in it. So total cash flow each month would be close to $600 a month. (I'd be using the VA loan, and asking price is 200k).
The problem I'm having is how successfull would I be in finding tenants to occupy the house.
The house is in a very heavily student-naval-aviatior populated area, so I could easily target them (I'm one myself), but I feel like this would be limiting my market. I mean, what family would want to live in a place that has strangers living in the backyard? Unless of course the family wanted to use the loft as a mother-in-law sweet or something along those lines. Thoughts?
I think if the student population is that big you don't need to worry about the possibility of alienating others. Sounds like you can easily get it rented out. Are the yards/parking areas all shared, or will everyone have their own space?
You may even be able to find an experienced property manager that would live in the main house and take care of the back units for a small rent reduction. Depending on where you are, those units might do really well on AirBnB. Where I live, my AirBnB properties cash flow more than double traditional rentals.
I don't think the area is close enough to downown pensacola to actually be used as an airbnb, but that is something I haven't thought of, so thanks for that! As for the Parking area, theres room for four cars to park right next to each other in the driveway. The tenants that live in the loft use the side gate for an access point to the backyard, I may put up a fence that way they sort of have their own little walkway so the backyard is seperated, but I haven't decided on that yet. Thank you for your reply Carrie!
So what is the property ZONED for?? yes current owners may be able to rent it out because they live on premise,, but legally what's it rental status.. if it is not owner occupied.
To rent out is usually never a issue people always need housing and if it's in a decent area you'll get someone to rent..
But legally what are your limitations..
Also realize you would need to live in the property to use a VA loan.
Sean and Deanna, thank you both for your input. Sean I forgot to mention that I will be living in the house myself until I move to my next duty station, and Deanna I will look into what it is zoned for. Again, thanks for the input!
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