Using SFR Rental as an Assisted Living Rental instead?

Question

Hey everyone!

Tonight at a Seminar the speaker was James Smith, he and his family are very invested in Real Estate across the world. I don't know how much I trust him personally, but he did make some good points, one of which was using SFR as an Assisted Living Rental. I don't remember all the specifics, but he was basically using 5-10 Bedroom (Large SFR) as Assisted Living businesses.

He talked about how the average cost of assisted living is 74,000 per year for a single resident in a normal home. He was discussing how he was able to both help others and make a lot of money off of it. He would hire people he would network with from other countries that were nurses, where a 50,000 dollar salary here to bring back to their families was a multitude of money in their home country, and how the Folks living in the Assisted Living Home were much happier to be in an actual house, with a nice yard, and only a few people instead of hundreds. Then on his end, he was making astronomically more than he would off of just a normal SFR Rental for a few hundred dollar profit a month.

I thought it was a really interesting point, and I wanted to share it with you guys and see what you think.

Gene Guarino · Answer

Hello Shane,

The market is for real.

The demand is high and a home is better then an institution.  The rates in the US are $3750 per person per month in a private room in AL.  Every state is different as is every city and neighborhood.  That "average" includes medicare and government assistance.  I own and operate these homes myself and I do not and do not encourage you to focus on that market.  You really want "private pay" residents.  They pay $4,000 to $8,000 each per month.  It is a great business with a real estate play attached.  Before you get involved learn all you can.  I would be happy to share some resources with you if you'd like.  PM me and I will get that to you.

TY

Gene