How has your experience been with PadSplit?

Atlanta, Georgia
Short-Term & Vacation Rental Discussions
3yFollow

How has your experience been with PadSplit?

Najhae Robinson
Member since 2020 · 3 posts · 1 vote

Hello, we run a PadSplit property management company in Atlanta, GA and we're curious on other investors experiences with the business model. What are some pro & cons you noticed throughout your endeavor? Would you recommend the PadSplit business model to others?

1Reply
169 views

Most Popular Reply

Zach Edelman
Lender · New York, NY · Member since 2022 · 1k+ posts · 1k+ votes
1y

Cons I would say are achieving financing. PadSplit's have been difficult to finance because they are considered modified collateral. Lenders unfortunately don't want to foreclose on a home with 6,7,8 homes on a property that's a true single family home. Secondly, the appraisal often notes functional obsolescence because of this and a lack of a common area. The cashflow is great, but getting financing is difficult, especially for refinances post modification. 

5Reply
See this reply in the discussion

11 Replies

Jump to latestLatest
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    3y

    So I am not very familiar with PadSplit @Najhae Robinson.

    All I know is the neighborhood backlash, the nightmare stories and the like.

    I have heard nothing positive about it.

    Oftentimes they violate the STR restrictions in cities because they will rent to anyone for any length of time.

    I would never look at this as a business model personally.

    1Reply
  • Michael SmytheBusiness Member
    Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
    3y

    Can only imagine the nightmares of dealing with disputes between occupants:(

    Logical Property Management4.9446 Reviews
    WebsiteView Page
    0Reply
  • Ben Firstenberg
    Investor · Cleveland · Member since 2021 · 247 posts · 240 votes
    3y

    Me and my team have helped investors buy a lot of Padsplits over the past few years. We've had a really great experience with the platform. There are definitely horror stories, but MOST of them work out well. You just have to pick your spots. Look for mostly investor owned neighborhoods. Clayton county and the south part of Fulton (specifically College Park) have been great for us. Want to make sure there's plenty of room for parking, as about half your tenants will bring cars. 

    The minimum "initial" lease term in Atlanta is 2 or 3 months, so they don't qualify as STRs, and thus don't have the same regulatory issues. It's a MTR

    It's definitely a little more headache than a typical LTR, but you're rewarded for the effort with much better cash flow. It's not unusual for my clients to bring in $5000+/month in top line revenue. 

    I frequently recommend Padsplit to my clients.

    @Najhae Robinson Would love to chat more your business. I'll DM you

    3Reply
  • Brooklyn McCarty
    Investor · Member since 2022 · 1k+ posts · 754 votes
    3y
    Quote from @Michael Baum:

    So I am not very familiar with PadSplit @Najhae Robinson.

    All I know is the neighborhood backlash, the nightmare stories and the like.

    I have heard nothing positive about it.

    Oftentimes they violate the STR restrictions in cities because they will rent to anyone for any length of time.

    I would never look at this as a business model personally.

    I agree. I have never heard anything positive  about it either 
    0Reply
  • Zach Edelman
    Lender · New York, NY · Member since 2022 · 1k+ posts · 1k+ votes
    3y

    If it works, the cashflow is tremendous. Like Ben said above, you just have to pick your spots. However, it's a great way to achieve STR esq cashflow without having to purchase assets that have a $250K+ pricetag.

    2Reply
  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    3y
    Quote from @Najhae Robinson:

    Hello, we run a PadSplit property management company in Atlanta, GA and we're curious on other investors experiences with the business model. What are some pro & cons you noticed throughout your endeavor? Would you recommend the PadSplit business model to others?

    My grandfather came to the U.S. in 1907.  For his first two years here he stayed in a rooming house, because he couldn’t afford his own house or apartment.

    After World War II this country “got rich”, affordable housing became plentiful as “the suburbs” were developed.  In the cities the government got involved in housing and low income housing was built for poor people. Rooming houses dwindled in numbers, and zoning regulations took out the rest.

    Now apartments in popular suburbs are as expensive as in center cities, and for people of even moderate means their own apartment or house may not be realistic financially.  So, people do what those wanting to live in Manhattan or San Francisco have been doing for 60 years, splitting rent on the “pad”.  Rent on a 4 bedroom place may be $5000 monthly ($12,000 in Manhattan); rent it by the bedroom for $1500 per bedroom with access to all common areas.  So, the landlord makes an extra $1000 per month with the same fixed costs.  If his fixed costs are $4000 per month his profit just doubled from $1000 to $2000 monthly. BUT…So has his aggravation, time commitment, and risk.  
    Private Mortgage Financing Partners, LLC
    WebsiteView Page
    2Reply
  • Miguel Del MazoPro Member
    Northeast Georgia · Member since 2023 · 140 posts · 170 votes
    3y

    I have a friend who PadSplits in south Atlanta.  He is living in the house and rents by the room via PadSplit. He enjoys the cash flow, has a good tenant screening process, and is OK with the tenant headaches that are going to occur.

    I would put it higher on the reward side of the profile, but it also is a higher amount of work and harder to scale endeavor.

    3Reply
  • Jean Brune
    New York, NY · Member since 2019 · 17 posts · 12 votes
    1y
    PadSplit has been doing well since starting back in 2018. We have had hosts on the platform since then that are continuing to do well and add units. We tell hosts all the time, it's more management and more money than traditional SFR. It's less work than an airbnb and in today's market it can be more profitable than an airbnb. 

    The best part is that you are making a positive impact on your providing housing for those who would not be able to afford living in said neighborhood.

    Managing the property and members are things the entire PadSplit team is good at. The PadSplit platform should be used as a resource/tool but please engage with the people in the organization. You can also find answers to your questions in the facebook group here: https://www.facebook.com/groups/officialpadsplithostcommunit...



    Quote from @Najhae Robinson:

    Hello, we run a PadSplit property management company in Atlanta, GA and we're curious on other investors experiences with the business model. What are some pro & cons you noticed throughout your endeavor? Would you recommend the PadSplit business model to others?


     Hey

    0Reply
  • Zach Edelman
    Lender · New York, NY · Member since 2022 · 1k+ posts · 1k+ votes
    1y

    Cons I would say are achieving financing. PadSplit's have been difficult to finance because they are considered modified collateral. Lenders unfortunately don't want to foreclose on a home with 6,7,8 homes on a property that's a true single family home. Secondly, the appraisal often notes functional obsolescence because of this and a lack of a common area. The cashflow is great, but getting financing is difficult, especially for refinances post modification. 

    5Reply
  • Elaine Kargbo
    Member since 2020 · 3 posts · 0 votes
    1y
    Quote from @Jean Brune:
    PadSplit has been doing well since starting back in 2018. We have had hosts on the platform since then that are continuing to do well and add units. We tell hosts all the time, it's more management and more money than traditional SFR. It's less work than an airbnb and in today's market it can be more profitable than an airbnb. 

    The best part is that you are making a positive impact on your providing housing for those who would not be able to afford living in said neighborhood.

    Managing the property and members are things the entire PadSplit team is good at. The PadSplit platform should be used as a resource/tool but please engage with the people in the organization. You can also find answers to your questions in the facebook group here: https://www.facebook.com/groups/officialpadsplithostcommunit...
     Hi Jean the link didn't work.  If I'm not interest in doing all the modifications will Padsplit still work with me? 


    Quote from @Najhae Robinson:

    Hello, we run a PadSplit property management company in Atlanta, GA and we're curious on other investors experiences with the business model. What are some pro & cons you noticed throughout your endeavor? Would you recommend the PadSplit business model to others?


     Hey


    0Reply
  • Puja Varude
    Member since 2026 · 13 posts · 4 votes
    8mo
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free