BP Podcast 356 - Section 8, Joe Asamoah, questions about rehab

[Patrick H.]

I recently listened to BP podcast 356 with Joe Asamoah who does high end Section 8 rentals in Washington DC. One of his strategies is to buy a 3 bedroom house with a basement and finish the basement making it into a 5 bedroom house. Does anyone else use a similar strategy?  He mentioned getting $5,400+ for his rentals which is way above the DC FMRs. How is he able to do that?

I made an offer on a 6/2 two-family (each 3/1) that has an unfinished attic with at least 7-8 foot ceiling. Both units total 2,100 sq ft and the attic is another 900-1,000 sq ft. The property already needs extensive renovation so would it be worthwhile to finish the attic by adding 2 more bedrooms and a bathroom (making one unit 5/2), assuming the cost wasn't too high? In this area, 3 bedroom FMR is about $1,390 and 5 bedroom is almost $1,750.

I am looking to BRRRR this.

[Russell Brazil]

Im in the DC market and friends with @Joseph Asamoah.  Ive also added bedrooms to houses.  Finding a location in the basement that makes sense for a bedroom, with proper ceiling height, and has the ability to add an egress window.

Joe gets above market rate rents in certain neighborhoods through section 8. DC has several neighborhoods that the section 8 rents are well above market rate rent. Takoma and Kingman Park being 2 of them.  Thats not universal though throughout the city. Some neighborhoods the section 8 rents match market rate, and some trail market rate.

Another way to get above market rate rents is to do a rent by the room strategy. We just filmed a video yesterday for BP actually where @Ron Gallagher uses that strategy here in DC.