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All Forum Posts by: Travis Schmidt

Travis Schmidt has started 3 posts and replied 11 times.

@Nathan Gesner

Thanks for that advice is sounds like a solid negotiating point.  They are high earners so there may be some leverage there.  

@Kevin Sobilo

Yes the costs of the damages is high.  My property manager takes hundreds of photos before move in and after move out to have proof of damages.  The previous tennants also were agreeable to which damages they were responsible for.  The most expensive item on the list was repainting the interior.  The entire house was freshly painted prior to them moving in.  After they moved out the walls were destroyed and 75% of the walls needed repainted.  They also allowed a small leak under a bathroom sink go unreported long enough to fill the entire sink vanity to be destroyed by black mold.  Their dog chewed an entire door frame off etc.. 

The property manager put together the list and also coordinated the repairs.  No premium was collected for managing repairs.  However, I don't doubt that if the work list was shopped to several contractors it would have been possible to lower the costs somewhat.  

I like the idea of continuing to negotiate with the previous tennants while they are still responding to emails.  Maybe we can come to a agreement in the middle. 

Charles,

I appreciate the feedback.  It sounds like the consenus amount the responses is small claims is not worth the time money and effort.  

The tenants do have the money.  Another reason I am considering going after what is owed.  But it appears it may be best to settle somewhere in the middle.

My previous tenants piled up a significant work list of repairs following out move out inspection.  The cost of the repairs the tenants are responsible for is an additional $4,526 after taking thier full security deposit ($2,775).  They have accepted the fact that they will lose their security deposit but are only willing to pay an additional $1,000 towards the remaining $4,526 owed.  

My Property Manager mentioned sending this to a collections agency but said there was no gaurentee that we would ever get the money owed.  

Should I be contacting an attorney?  I understand this will be expensive but $4,526 is also a lot to lose as well. 

Post: Padsplit pros and cons

Travis SchmidtPosted
  • Posts 11
  • Votes 14
Quote from @Curt Smith:

Hi Travis,  I'm in Atlanta the home town of padsplit's start.  Am in a group where members might be running in the range of 100 doors (x 3-5 rooms each) of padsplit.  I don't have any padsplit though for reasons I'll tell.

You will be mostly wrong assuming padsplit is lower effort, hours / week managing vs airbnb.   Your time running an active business of padsplit (or DIY rent by the room) varies per week. Some weeks no effort, others when you need to "put out a not working out tenant" more work.   The early days padsplits operations process tried to run uusing hotel tenancy laws, that has fallen by the wayside due to magistrate court/fitting into a standard eviction process via magistrate court.  So tenants that don';t work out can be stuck in a room for 2 months while the slow eviction process works through.   Airbnb you just call the police and they are gone.

Padsplit simililarily to airbnb, site selction is very important. Only a few houses will work for either; parking, isolation from neighbors etc. IE its a very bad idea to attempt rent by the room with close neighbors, or in a nicer HOA neighborhood where tenants are seen walking streets to the bus/mass transit. Depending on your location, more folks will apply for renting by the room if you are on/near mass transit. Padsplit can still work in the burbs, but you need lots of parking and space to the neighbors.

Padsplit is only up and running their francise in the bigger cities.  Otherwise you are DIY running a rooming house and its alot of work screening and managing the 2am fights, tenants leaving their trash in the kitchen iratating the other tenants.

Its all doable, just the actual amount of hands on is more then you might think, even if padsplit is in your area and is willing to take your house into their system.   

Risks;  zoning / code enforcement for running a rooming house, more then the county limits on un-related adults in a rental.  In Atlanta area its 3 unrelated adults.  Code enforcement in Atlanta area is lower since the locale's realize that padsplit is providing low income housing so code enforcement follows neighbor complaints or repeated police visits.

Your experience maybe smooth and easy, and I hope it is!!   Same with Airbnb can be smooth and easy.  Both need systemitization!!!!  

What my friends say is the $$ advantage over 12 mo term rent is around 3x higher net.   There is up front costs like dividing the living room into 2 more bedrooms etc plus the simplier furnishing.   Remote control and locable thermostates,  water leak detetors and main cut offs.   The multi door padsplit operators have alot of home automation they remote control and monitor including cameras on the front door (not interior), remote managed bedroom door locks, front door lock etc etc.

I won't get into either rent by the room or airbnb!  We prioritize OUR lifestyle and free time over income.   I only own nicer rentals with fenced back yards and rent to families with dogs.  I never hear from those folks.  :)

Best to all,  curt


 Curt,

Thanks for your input and breakdown I really appreciate your insight.  There are absolutely some additional challenges with the rent by room model and I agree it could easily be more work than an AirBNB.  Padsplit is in the Jacksonville area and they told me they would guide me through the process on where/what property to acquire.  I still have more research to do but at this point. 

Best Regards,

Travis

Post: Padsplit pros and cons

Travis SchmidtPosted
  • Posts 11
  • Votes 14

I'm a new investor looking for ways to find cash flow in this challenging market. I was recently introduced to the rent by room Medium Term Rental platform Padsplit.com. It looks like a less labor intensive way to increase cash flow over the STR route but also includes structural changes to a single family home (additional setup costs) and dealing with low income tenants. I haven't seen any posts about this option and was very curious to see if any investors would be willing to share their thoughts or experiences. Thanks in advance!

Quote from @Cody Hunter:

@Travis Schmidt A PO Box is a simple protection to safeguard your assets. Also using a registered agent and/or virtual office aids in hiding your address. I'm not sure about FL but here in OR unless this is done at the beginning, your information is still public. That is because it will be on the original documents. So while the database is updated, the paperwork still shows. 

Correct. Ideally, I want to set up the LLC as anonymous as possible to protect yourself and your personal assests from potential lawsuits.

@Chris Horlacher thank you for the tip.  Legal Zoom would have been happy to charge me to change it on my behalf.  It looks like it can be changed very easily on the Sunbiz website. https://dos.myflorida.com/Sunb...

@Allan Smith Thanks for the advice. I'll look into the advantages of creating a separate LLC for my rental portfolio.