All Forum Posts by: Jonah Hartsburg

It depends heavily on which college and the level at which its impacts the economic fabric of its community. I live and work in a small Indiana town that has a private university. Here, student rentals are heavily dependent on who you know and your reputation. Turnovers can be tricky with graduating students, student’s getting married, and transitions between school semesters. But if a few students have a great experience in a rental, they will often refer their friends. Some of the challenges I’ve seen here are in the early stages of building a reputation of quality student rentals and then keeping your pipeline of upcoming students full for when turnovers occur. 

@Adina McCollough Definitely!

@Adina McCollough I know this is an older post, but I’m a realtor here and own a duplex almost right across the street from the university. It’s currently rented to a new employee at the university. The area is definitely a cash flow market for niche investors as general property values in the Indiana MSA’s continue to heat up. There’s been growth around the university on the south side of town over the past few years coupled with more recent pushes to restore the older downtown area. 

With the right connections and/or advertising, landlords have found groups of students and individuals looking for local off-campus housing. The graduate students tend to be more active looking for off-campus housing since their alternatives are shared townhouses. 

@Tricia O'Brien Hey! I live in Marion and worked for a former property management company here. Property values definitely make it a cash flow area. Some of the primary economic drivers include Marion General Hospital, Cafe Valley, a GM transmission plant, and the small campus of Indiana Wesleyan University (a little under 3,000 enrolled). Some areas can get very depressed and rough towards the old part of town. If you can get a rental south of 38th street near the university or even more south, property values tend to be more stabilized. I’m not sure who you’re working with, but I don’t know of any reputable property management companies local of Marion. However, I’m hearing word of possible start-ups. Feel free to pm me! We should get on a phone call.

@Toneisha Moore Don’t know if you’ve already landed with a title company, but we’ve worked with Security Title Services many times from direct to owner purchases to wholesale deals that included agent commissions and OOS buyers. They have locations around Indianapolis and throughout Indiana. They can easily order remote closes for OOS buyers as well. 

Great idea! I don’t have direct experience in renting rooms, but I’ve worked in property management in a college town and currently rent the other side of the duplex I live in, which is right next to the local university. 

Most schools have a school-specific Facebook marketplace group(s) where students/faculty/alumni post ISO and for-sale items. That’s a good place to get the word out and post listings. Also, there are often bulletin boards in schools where you can hang flyers (although sometimes those need approval before posting). I would also check with the housing department of the school and see if they have any suggestions. While they are technically a competitor for housing, there’s a good chance they would be friendly and offer advice in the interest of their students and the community. Then word-of-mouth is an excellent source for students as they want to live cheaply with their friends and give referrals to incoming students.

Another initial suggestion is to make sure to review Texas Fair Housing laws and make sure your advertising and screening process aligns with those laws. I am definitely not offering legal advice but would double check to make sure you don’t run into any future troubles. Also, check the housing guidelines with the school to see which students are allowed to live off-campus without a legal guardian. The school near me just enacted a policy somewhere along the lines that students have to be 23 or older to live off campus unless they live with a guardian or are married (marriage incentives, right?). The local landlords are still trying to figure out how to find a loophole with the policy.

Great opportunity! If there’s any way he could employ you or you could help him with something for free to be able to really see how he handles his businesses, I think that would be the best way to learn from him. 
But for specific “pick-your-brain” questions, here are a few I initially thought of:

-What would you do in my situation (stage of life, finances, career, etc.) to be a successful investor?
-What was the most helpful resource (individual, group, book, career, etc.) that guided you from a new investor to where you are now?
-What did you learn from your biggest mistakes along your investment journey? 

Hope that helps!

Hey Caleb! That’s awesome! I walked through some of that while I was in college. If you’re decided that you will get your license and if you already have a broker school picked out (online or on-site), I would go ahead with both and start meeting with brokerages as you are taking classes. It takes some time to get your license, which gives room for you to meet with multiple brokerages. It also shows brokerages that you are serious about getting into the industry if you’re enrolled in the course. When you reach out to local brokerages, try meeting with them in person to discuss your goals, what they offer (resources, training, commission splits, etc.), and if you would fit well into their system. 

Does this semester give you some extra time to study for your broker license? If not, you could meet with brokerages during the semester then try to take an intensive broker course over the next school break. 

While having a mentor is needed, I don’t think you need to delay getting your broker license because of it. You can jump right into it to get the book work done and then continue learning through hands-on experience with your managing broker/mentor.

Hello, Thomas!

Nice job thinking through all of this and trying to plan out the best strategy. There isn’t a set discount that we plan for with our cash offers. It really just depends on the seller’s motivation. There’s a good chance though that they would pick you over someone else or that you could get some kind of discount. If you’re low-balling especially, I would make sure that you’re pointing out that it’s a cash offer. 

With a mortgage, I would take $250/door in cashflow all day! The issue, however, is that your cash flow isn’t going to be close to that amount. In the numbers you pointed out that you excluded maintenance. Then you also have vacancy, capital expenses, property management if you don't manage it yourself, and any utilities, yard work, or whatever extra expenses you may have. 

Often, you may hear of the 1% rule. For most investors, they won’t even look at a property if it doesn’t bring in monthly rent that is at least 1% of the purchase price, or if it at least has potential to with some work. So this one is only renting $4,200/m and they’re asking $554k. Even if it brought in $5,540/m, you still would need to look into all your upkeep and running expenses to see if it would provide actual cashflow. 

The good news though is that you’re looking and analyzing! That’s a giant step in beginning. 

Cirilo,

Good work! You should be able to look up tax records online according to the home address to get the name of the individual(s) or entity that own it. Those records should also contain the mailing address for the owner. From there, you can proceed how you want to try to reach the owner.