Fairly often, people hit me up for advice on opening and running a recovery house. What they may not realize is that it could be considered as another form of special needs housing. For me, my journey with special needs housing began almost 25 years ago.
At that time, I was providing low income housing through the government Section 8 programs, which provide government subsidies for those who are of low income, due to a variety of reasons, including disability.
My second experience came from working with folks, who utilized Community Action either for emergency housing or for down payments or rent, often due to a distressful situation, such as being homeless with children or a being a battered parent or spouse with children.
But my third experience, which led me to owning and operating a drug and alcohol (privately owned) recovery house, happened pretty much by accident. My oldest son was in recovery, and he was asked to manage a house for the owner of several recovery houses in a nearby county. This is where my son had gotten well after having a long run of multiple attempts at recovery with little previous success.
The second part of the perfect storm was that my wife and I were looking to downsize from our primary residence, mostly for lifestyle reasons, but the real estate market had already tanked. So, we both took some chances and decided we would open up our own recovery house with our primary residence, especially since there was a drastic shortage of facilities in our area.
How I Bought, Rehabbed, Rented, Refinanced, and Repeated for 14 Rental Properties
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Starting a Recovery House
Once we had the buy-in of me as owner and my son, who had lots of experience with recovery, as a manager, the rest was the easy part. Having a good property, location, and furnishing a place might not seem like the easy part to the typical real estate investor, but it is. The hardest part is having a good manager, culture, and reputation. It also helps to have a big “why.” That’s what keeps you going during the tough times. Most real estate investors have dollar signs in their eyes when they think about renting beds out, but there’s also a lot of responsibility and liability that can go along with it. Personally, my son and I don’t really do it for the money, as there are much easier ways to make a buck.
In the beginning, besides filling up the house, the biggest challenges for us were the township and neighbors. Everyone thinks a recovery house is a good idea as long as it’s not next to them. The truth of the matter is that we never have really had any criminal problems.
The types of issues we usually have are things like an uptick in turnover or someone breaking the house rules. Occasionally, though, we do lose a resident or former resident, and it’s a grim reminder of the life-and-death battle being fought out there on the streets in terms of addiction.
There is some light at the end of the tunnel, though, just in the fact that you never have a complete vacancy. Residents also do chores, like maintaining the grounds and shoveling snow. There is some wear and tear, but usually someone at the house is handy in a trade as well. For example, some residents have been chefs, plumbers, electricians, etc. Also, residents can span anywhere from ages 18-65 and are from every walk of life.
Another challenge for us is the enabler in the addict’s life — usually a parent or spouse — who inhibits the resident’s recovery. The most common traits I see in a typical resident are selfishness and a lack of maturity. There have been times when we had to tell a parent that they need to let Junior grow up and to stop calling the house.
By far, the best part about owning and running a recovery place has been what it’s done for my son and for me, as it’s probably one the most rewarding things I’ve ever done in my life. I’ve had people come up to me crying and saying that my son or I have saved their life, their child’s life, or their spouse’s life — and it’s very hard to put a price on that.
Nothing is better than to see a resident or former resident move on, land a good job, get married, buy a house, or even start a business. It’s one of the greatest feelings of accomplishments in the world.
Many of us know someone struggling with some type of addiction and feel like we would like to do more to serve this community. So, if you are on BiggerPockets and you are contemplating opening some type of drug and alcohol recovery house, a great resource when starting out is going to the Oxford House website to learn more about running recovery houses in general.
Anyway, who says you can’t manage rental properties and do some more socially conscious investing at the same time?
Let me know about your socially enriching real estate projects with a comment!