Subletting as first REI experience

[William Waller]

Hey Guys! 

I have an interesting situation/opportunity on my hands. First, a brief overview of my situation. 

For the past 5-6 months, I have been living on bigger pockets and learning as much as I can about real estate investment. I decided on focusing on BRRR in the Colorado Springs area as that is where I am from. However, I am currently living in New Zealand. I would love to buy here but as a non-resident, I am not allowed to.

My employer has just purchased a new home and is moving out of his current home that is managed by a local property management company. He has agreed to transfer the lease over to me to sublet it out. It is unfurnished, and the owner will remain responsible for repairs, etc... 

The lease is for $2800/month. I will be able to rent the rooms out for a total of $3800/month with current market conditions. I will be responsible for keeping the rooms full (housing crisis in the area so will not be an issue), notifying the management company of any repairs that need to be made, and furnishing the place. I also have tenants ready to move in that I know and trust. It is a month to month lease. 

This seems to be such a profitable and low-risk way to be gain some landlord experience and get some cash flow to put towards my own property. Is there anything that I am missing or things that I should be wary of going into a situation like this?

[Bill S.]

@William Waller what could go possibly wrong??? Well probably nothing, but all kinds of stuff that you read about here on the forums happens to folks every day that blows my mind.

Biggest issue is whether or not the current lease allows for sub-letting. Good leases out-right prohibit it for the very reason you are asking. I don't want some newbie with zero experience selecting people to live in my property. In addition the number of adults in the property will skyrocket. More people means more wear and tear on MY property with no more rent to compensate for wear and tear. 

What will happen with damages, who pays for that? Doesn't your employer want their full damage deposit back?

Bottom line, you do a good job of screening tenants and managing the property and probably nothing bad happens. At the same time, tons of stuff could go wrong and blow up in your face (things we have never dreamed of too).