Assisted Living House Hack

[Casey Caton]

Investment Info:

Single-family residence buy & hold investment in Rio Rancho.

Purchase price: $450,000
Cash invested: $30,000

I was searching for a house hack with many beds and baths, and I found this property at 3300 sqft, 7 beds, 5 baths, and the key was it had been converted into assisted living. Long story short, the previous owners were licensed to operate assisted living facilities, and we entered into a business and lease agreement for them to lease out the remaining six bedrooms and operate the assisted living facility. Their company pays us 3K rent per month and we share the profits from the business 50-50.

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

Cash Flow and providing an awesome place for older folks to live.

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

MLS, and we negotiated down from 475 to 450 because it had been on the market a few weeks, and it was a unique property.

How did you finance this deal?

Agency loan with 5% down (primary residence).

How did you add value to the deal?

Creating a business partnership to operate it as an assisted living facility.

What was the outcome?

Great cashflow of 1800 per month and meeting a great family who we will hopefully work on more deals with.

Lessons learned? Challenges?

Don't give up looking through the MLS - there are diamonds in the rough.

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

Yes - we had a local agent who knew the area well.