Crash Pad Property in Humble Texas

[Sam Peterson]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $242,548

Airline Crash Pad with 18 beds available for a total potential for $4225 per month.

What made you interested in investing in this type of deal?

I have seen other crash pad operations and thought I could certainly do it better.

How did you find this deal and how did you negotiate it?

I called a realtor in Houston from an internet search. She picked me up from the airport. I brought a friend who had some knowledge of real estate investing and we walked through a few houses before this one screamed that it was the perfect house. My realtor linked me up with a lender and we applied for the VA loan for a 0 money down loan and we got into it for 3.875 APR, 30 year fixed for a total of $242, 548. I spent the summer furnishing the house, to include building bunk beds in my garage.

How did you finance this deal?

VA loan, 0% down, 3.875%, 30 year fixed.

How did you add value to the deal?

I filled the house with bunk beds and rented out beds on month to month to airline crew members.

What was the outcome?

We now have a Flight Attendant managing the house for us and keeping it clean and organized. We average 16 tenants a month. There is a lot of turnover but we are clearing roughly $1,000 per month above expenses on average.

Lessons learned? Challenges?

It's not a sustainable model and requires a lot of attention. The turnover rate requires effort to continue finding renters. It's a very unique investment in that I have to pay for all the utilities but the income is very good when the house is full.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

My lender is a rock star. His name is David Richards in the Houston area. He finds solutions for your problems and doesn't say "no". He says, "let me get back to you". Also, Debra Osborn-Camino is my real estate agent and she has been very good at finding exactly what I have been looking for. She's a great listener and produces solutions.