Master Lease Rent Payment to Owner

[Shelli Schilke]

I'm chatting with a guy who has a 5/2 SF house in the Tampa Bay area and he's renting out 5 rooms on a month-to-month basis. He doesn't want the hassle of doing that anymore, but selling his property will be a challenge.

I suggested doing a master lease listing me as the master tenant and then I would sublease the rooms to his current tenants. I would basically do what this owner is currently doing, which is more or less property management. He asked me for numbers, but I have no idea what would be equitable for something like this. To me, it's like Airbnb arbitrage, but for mid-term rentals.

He's getting $4K/month total rent. If that's what I would be getting from my sublessors (i.e.current tenants), how much rent should I pay the owner?

Your feedback would be greatly appreciated.

[Michael Smythe]

@Shelli Schilke average PMC management fees are 8-10% for LTR.

Higher for MTR & STR due to greater time investment tied to turnovers.

Room-by-Room is also higher due to higher management involvement. Probably 15-20%.