Rent out rooms or the whole house?

5 Replies

I maybe leaving the area for a few years and need to rent out my personal residence. It is a sfh 1250 sqft 3 bed 2 bath my first home. The same house in my area rent for 1250 a mo. Bed rooms tend to rent for 550-650. This seem like a no brainer my wife is concerned about find three good tenanted vs one. With management fees I would be 100 or so out of pocket just renting it. It on a 15 year mortgage with a good interest rate. What other advantages or disadvantages to these two possibilities? Thank you for your time. BP family
Increase your costs if you rent by the room. who owns furnitue and takes care of the common area?. Who does exterior maintenence? how do you manage utilities, are they included? Also consider if you are looking at the studemt population they are harder on property. consider management of 3 leases/ tenants vs. one. In the end are you making more? are you spending more time on showings, managing,etc. I am not saying dont do it rather that you should consider the profit margin for the additional effort.

Given your situation I would have to definitely side with your wife. It isn't worth the extra hassle of trying to manage not only 3 tenants vs 1, but also some of the drama that is bound to come up among tenants in  the common areas. 

Since you already live there, why do you need a PM? I'm sure you know someone who could do basic repairs if you called them? It sounds like a nice house considering it has been your primary residence and will rent for $1250/month. Once you get someone in there it will be very easy to manage with little to no repairs/interactions from the tenants. 

Set something up for either auto pay like some of the people on here do and make it even easier. I use Venmo for my tenants to pay me, but it isn't automatically deposited from their account.

PM is going to take $1,250 up front from you, then another $125/month. There is the $100/month you say you will be paying out of pocket. 

I would much rather completely manage 1 tenant than using a PM to find 3 tenants. Best of luck and I hope I have at least given you some things to think about. 

What is the value of the home and what are your future personal life plans.

It may be more beneficial to simply sell. Renting is not always the best scenario in your situation if the home was not purpose purchase for a rental. Renting could cost more that it is worth, tenants tend to be very hard on a property so if moving back it will require some renovation and you may also face PM issues and tenant issues/evictions.

If you intend to be a landlord do so as a investment plan not as a stop gap solution to relocating. Being a landlord/investor is not fun and games and far from passive or easy.  

If you hire professional management you could Short-Term rent each room or the whole house, and have them run it as an Airbnb.

My company does this in Tampa. I don’t currently have any contacts in VA Beach, but you should be able to find them. BP isn’t a good place to find us bc if we mention our business at all they delete the post as “self promotion” lol.. whatever, I get it, we’re the new guys. But I will tell you as an investment strategy STR is very real, & big time cash flow investors are definitely using it.

You won’t have to do anything at all. You’ll be paying them a lot more than $125 a month in commission, but that means you’ll also be collecting significantly more than you would have renting it traditionally, so everybody wins there.

If u have questions on how it works or need tips PM me. Good luck!

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