Best Practices Regarding Military Crash Pads

39 Replies

I am active duty and have been focusing on the buy and hold/BRRRR strategy. I think military crash pads are a subset of that.

A military crash pad is alternative, off-base housing for TDYs (paid for by govt per night/per room).

If you have any experience, question, or insight on this please let me know. Thank you!

@Haji Dunn Please explain more. Are you actually contracting with a government entity to rent out your property for short-term rentals? If so, I'm curious how that works. And what are you seeing for returns? And in what market?

@Haji Dunn I heard about a place called Liberty Lodging last time I was at Wright Patterson AFB (Dayton,OH), that might do something similar to a "military crash pad". If I recall correctly, they matched the lodging rate on base and students in the tech schools rented out their apartments during their TDYs. A few of my buddies did this. 

@Stuart Grazier - Unless I'm mistaken by his intent, no, not contracting with government entity. I think the strategy is more based around the publically available TDY rates that military personnel receive while on a temporary duty assignment to somewhere other than their permanent duty station. 

Example - If I am stationed in NC but I'm sent to GA for 60 days of training, the Army will pay me a certain daily rate for food/expenses and will pay for either then on post hotel or to stay somewhere else based on a maximum rate (for example $120 a night). In practice, I'd likely pay for that nowadays on a Government Travel Card which is just a simple credit card that the government pays off once the trip is completed. 

Hopefully I'm on track with his intent, but I'm guessing he just means marketing and utilizing it for these types of short term stays (i.e. not locking it up in a 12 month lease)

@Hunter Locke Got it. so basically renting it on AirBnB or VRBO as a short term rental verse a long term rental. So it really doesn’t have anything to do with renting specifically to military people on TDY orders but just rent short term verse long term and try and market to military and/or buy around a military base so you get that specific clientele, correct? Not a bad option if you have all the property management set up to continually keep the place cleaned and kept up when you have a turnover of renters. Lots of turnover! Curious what that costs?

Originally posted by @Stuart Grazier :

@Hunter Locke Got it. so basically renting it on AirBnB or VRBO as a short term rental verse a long term rental. So it really doesn’t have anything to do with renting specifically to military people on TDY orders but just rent short term verse long term and try and market to military and/or buy around a military base so you get that specific clientele, correct? Not a bad option if you have all the property management set up to continually keep the place cleaned and kept up when you have a turnover of renters. Lots of turnover! Curious what that costs?

Correct on your assumptions, proximity to base, possibly getting a referral relationship going with base housing/base hotel, etc.

Not sure on the costs, no experience in short term/high turnover rentals here! 

I chatted with the military crash pad folks (https://militarycrashpad.com) last year about renting out my house in Pensacola, but ended up just airbnb'ing it myself. They wanted a surprisingly high percentage of the income. They brought the short-term renters in contact with you, but you did pretty much everything else, including furnish the home to their standards, pay for cleaning/management, etc. 

I liked the autonomy of airbnb, and I think the cut airbnb took was fair. 

Lots of crashpads around training bases.  I stayed in one during a 4-month TDY in San Antonio.  Company charged the same rate as on-base lodging and provided full furnishing, high-speed internet, premium satellite/cable TV, decked out patio with pool/spa, cleaning/maintenance, and more.  A 4-bed property can produce solid income but consider the expenses that go along with it.

I'm stationed in Altus (airlift/tanker schoolhouse and just received the new KC-46) and there are a bunch of them here, ranging from condo/townhome size to single-family residencies.  Students are in training anywhere from 3-6 months, just so you have an idea of turnover rate.  

@Haji Dunn I did not have similar revenue on my Airbnb. I'm skeptical of those kind of numbers though; I'd like to see the financials for one of the mil crashpad homes and see if the reality matches what they tell potential clients. Maybe it does! I enjoyed being an airbnb host and recommend it to anyone. I transitioned to long-term renters once I moved away from the area, and it has been a good decision so far. 

Does this still work well with those 75/55% rules they enacted a bit ago?

*typo fix

@Haji Dunn this is a great topic to bring up. I have a whole story about a hotel I noticed in a military town that I thought I could work a deal on that wound up going nowhere (it got razed by the time I was ready to look at making an offer) that I won't bother anyone else with outside of my 9-5 co-workers, but this is definitely something that people should look into, and a great investment opportunity for active duty members of the forum with enough discipline to buy and hold as they PCS various tours over their career. I wish I was smart and disciplined enough when I was in to do that.

People talk about the benefits of the Montgomery GI Bill, and that's great, but the single best benefit of military service aside from serving your nation is the VA home loan. It's bonkers good and not easy to abuse (which if we're being honest, makes it that much better for smart servicemembers).

@Haji Dunn

Basically if a TDY is going to be over 30 days, the reimbursement rate drops.  It goes to 75% of the published rate if the stay is 30-180 days and 55% the published rate if over 180 days.

@Haji Dunn @Douglas Spence Thanks for mentioning the crashpad site and concept. I had never heard of it. One thing that worries me about all of these new short-term rental companies is that there are quite a few cities that are starting to enforce new rules regarding what you can and can't do. I know there is a lot of scrutiny with hotels loosing business and cities are starting to get more involved in regulating the short-term rental business. I would hate to make an investment decision, based solely on short-term rental projections, and then find out a year later that the city isn't allowing short-term rentals (or putting additional taxes or rules in place) that diminish those returns. 

I agree with Stu. The legal issues surrounding short-term rentals contributed to my decision to not purchase a home in San Diego and Airbnb it. 

If someone is considering doing the military crashpad idea, I would contact a property manager and find out how much your home could rent for to long-term tenants as a furnished home. Then run your numbers with that rental rate as a worst-case scenario to fall back on if there are legal issues with short-term rentals. 

Also for you fellow military folks that are smart with traveling, doesn't the JTR require individuals to stay in on-base lodging unless it's fully booked? Wouldn't someone need a Certificate of Non-Availability (CNA) to be allowed to stay off base?

@Kris L.

I do not believe this is true anymore. I believe August of 2018, a bill was signed to get rid of the 75% for TDYs greater than 30 days. It is now 100% but I am unsure of TDYs greater than 180 days. However this is just for the per diem rate and not the lodging rate. The lodging rate stays the same regardless of time frame.

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