Tips on filling a rental room by room

[Chris Trefry]

I am looking for advice from anyone who has done this or something very similar. All tips appreciated!

I recently purchased a 4 bd 2 bath house in Arizona with the intention to create cash flow. The going rate for a single family to rent is around $1,900 - $2,100 a month in the area. However to create the desired cash flow, I am looking to rent it out per bedroom. The going rate per room is an average of $600 a month for young professionals, which totals $2,400 a month on the low end.

Ideally, I will find a group of 3-4 friends who would like to live together and each pay $600 a month per room (this is what I was doing before I got into REI). However, this group may not come up in the month that I will be searching for tenants. In which case I plan on getting one person in there first, letting them have about $50 a month less on rent on the condition that they stay in close touch with me and give me house updates to create a strong relationship with me to prevent any problems.

Has anyone done it room by room or found a group of friends/coworkers to do it this way? 

[Ryan Evans]

I've got a friend doing a similar strategy in the PNW by building 5-6 bedroom houses and nicely furnishing out the common spaces then renting individual rooms for 900-1200 per month. That includes the utilities, housekeeping, netflix, hulu, internet, etc. Basically, all the stuff that makes it easy for a young professional to show up with a bed and dresser and be good to go. I think the leases are for a year and the tenants are unrelated parties, but he puts a lot of effort into creating a cohesive group and makes a killing at it! It takes a bit more work on the management side, but if you're buying locally and it's worth the extra time, then why not go for it.