I have finally closed on my first duplex in a local city(second property, yay!) and i just had a few questions on some strategies to increase cash flow.I'm going to be living in one unit, and renting out the other. This is a fairly large duplex being a 4/1 lower unit, 3/1 upper unit.
I have finally found tenants for the lower unit, which agreed rents allow me to cash flow a little when expenses are said and done.I was just wondering on strategies to utilize the additional space in my unit(3/1) while i'm living there, and i was thinking about renting out the 2 additional rooms.
I plan on managing the property myself, i was just wondering if anyone can give some basic pointers on doing this. Also, can i just use the same MN standard lease format customized for the speculative roommates? What would i need to watch for compliance wise? Determining rents per room, would i just again use 3/1 market comps?
Thanks. I know its a wide scope question. Just wanted to see poster's opinions as i'm doing my research on it.
Hey @Bjorik Mutize ,
Airbnb is a great strategy if you're in a good location and need a little flexibility along with higher cashflow. I charge $600 with all utilities included when just renting a room.
Just use a standard lease.
We have rented rooms in the past, rates ranged from $450-$500 per month which included utilities, internet, etc. These were in the cities of Hopkins and Blaine with decent sized houses.
Thank you guys. Yes this particular property is located in St.Paul.
Yes I have been looking at AirBnB as well. There was something called AirBnB-DNA that breaks down market demand for a particular area, and I’ve been looking at that to get another strategy.
This property is located by Metropolitan State University so I was going to position and market the rooms based on that and perhaps other short term rental ideas.
I’m appreciative that I was able to get the bottom half rented so quick.
@Bjorik Mutize in that area I wouldn't ask more than $500 with all bills paid.
Great, thank you. @Jordan Moorhead
Hey @Bjorik Mutize ! So, I’m not sure what the market is like in your city but I currently rent out one of my rooms through airbnb and it’s been awesome! Granted, I live in a hot area on the north side of Chicago where there are Michelin rated restaurants, nice bar scene, and public transportation readily available. But, I’m assuming Airbnb would work in Minneapolis and they help to make sure you get the most out of your bookings. I’ve pretty much followed their advice on what to charge and it’s been working. It’s also fairly easy to maintain since guests, for the most part, just stay in their room. Since they’re cognizant of the fact that you are there with them, they keep the room very clean and try not to bother you. So, clean up usually consists of the room (change bedsheets and pillow cases and mop floors) and bathrooms; it doesn’t take more than an hour. Hope this helps!
@Bjorik Mutize - easiest thing to do is to hop onto craigslist or Facebook marketplace with photos and offer your bedrooms as furnished (or unfurnished - furnished saves my walls) for $400-600, whatever the market will bear. I always say utilities are split by the number of people living there, so they’re not all included. I use a normal lease but write it for possession of just the bedroom with shared access and liability for common areas.
FYI, if people are living with you, the rules are different. You can decide who lives there are can deny someone just based on a hunch.
If you are getting roommates that you don't know I would spell out what is included. Is toilet paper included, food, drinks, etc. What can they use and what can't they. I would personalize the lease to fit you.
@Todd Dexheimer Thank you Todd, I will definitely keep that in mind. I have been tweaking the MN standard lease to fit some of this criteria for the past few days, while beginning my marketing to see if I can get applicants.
Hoping to tread carefully!
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