Turning Your Property Into a Co-Living Opportunity and Accessing Your Equity

[Cydney Gray]

If you currently own a rental property, converting it to a co-living model can be a powerful way to increase rental income while also unlocking equity.

Instead of leasing the entire home to one tenant, co-living allows you to rent individual bedrooms with shared common areas such as the kitchen, living room, and laundry. This approach often increases the total monthly rent compared to a traditional single lease.

Once the property is operating as a co-living rental, you may be able to refinance using a DSCR (Debt Service Coverage Ratio) loan and take cash out of the property. You can qualify the property using separate lease agreements for each room, rather than requiring a single lease for the entire property. The combined income from those leases can then be used to calculate the DSCR.

This structure allows the financing to reflect the true income potential of the property, which may help you qualify for a refinance while accessing equity to reinvest in additional real estate opportunities.

If you're thinking about converting a property to co-living or want to explore cash-out refinance options using DSCR financing, I'm happy to walk through the numbers and see what options may work for you.