Investor · Atlanta, GA · Member since 2020 · 25 posts · 13 votes
I plan on selling two Atlanta properties currently operated as room-by-room rentals and would love to learn from others who have gone through a similar sale. If you’ve successfully sold a co-living, PadSplit, or other room-rental property in Atlanta, I’d appreciate hearing about your experience and what helped the process go smoothly. I’m especially interested in learning how you approached pricing, marketing, and choosing the right real estate professional.
Real Estate Agent · Atlanta, GA · Member since 2020 · 1k+ posts · 1k+ votes
6d
@Ike OkwerekwuI'll save you the biggest headache upfront when it comes to selling an occupied co-living property.
If your property was set up where common spaces — dining room, living room, basement, etc. — were converted into bedrooms, the prospective buyer absolutely needs to work with a DSCR lender who is genuinely familiar with co-living. A lot of lenders will claim they are — trust me, they're not. There are only a handful out there who truly understand how to finance this asset class, and those lenders have a board of appraisers who are equally familiar with assessing co-living properties, which significantly helps the process. Work with a lender outside of that space, and you will run into issues during escrow. If you'd like to get connected with the lenders I'm referring to, feel free to reach out, and I'll make that happen (contact info is in my bio).
On valuation and pricing, it's a combination of a sold comp approach and an income approach. What are comparable properties selling for in your area, and what NOI is your property currently producing? How well has it been performing, how long has it been operating, and how long have the members been in place? Providing financials upfront will generate more serious and stronger offers — no financials, expect weak ones. On the marketing side, be sure buyers understand the capital and work that has gone into the property and what improvements have been made. And have this information readily available, because buyers and their agents will ask immediately: occupancy/vacancy status, member tenure, utility information, NOI, operating expenses, any code enforcement issues or citations, and a member dashboard reflecting weekly rental rates.
My team and I transact co-living properties on a consistent basis and have a solid read on where the market is currently trading for this asset class. We're also connected with a real estate crowdfunding platform that has been one of the most active buyers of co-living properties in Metro Atlanta this year. Happy to connect if that's of interest.
If you're looking to sell off-market and represent yourself, there are a few platforms worth knowing about — Facebook Groups: PadSplit Atlanta Host Group, Co-Living Properties For Sale, and the Official PadSplit Host Community. PadSplit also has their own marketplace where you can list directly for potential buyers to review, which is a solid way to generate prospects.
What's the makeup of your two properties — bedroom/bathroom count, general location, and how have they been performing?