All Forum Posts by: Bonnie Low

I have offered it, but am unsure whether they're using it or not. Usually, tenants are receptive to the idea but I also wonder if tenants with a higher credit score care less about this feature than ones with a lower credit score who are actively working to rebuild their credit? I like this feature of Baselane and will be interested in hearing what kind of uptake there is.

There are SO many books and podcasts out there on getting into real estate. Just search the Bookstore here on BP and you'll find many. As for MTR, right now the definitive book on MTR is by Zeona McIntyre and Sarah D. Weaver and is called 30-day stay. That's a great place to start. If your friend is more of a Youtuber, turn him on to Erin Spradlin's MTR channel. Good luck! 

Quote from @Jaskanwal Preet Singh Chhabra:

Hello, I am an investor in Austin, Tx. I am looking at a 4 bed 2.5 bath property in Pfugerville, TX that I am planning to rent out as a co-living space (rent by the room on Padsplit). I will be converting it into a 8 bed 3 bath property. However, in adding the bedrooms, no new sq.ft will be added. I will split a giant master room into two smaller rooms and will convert the living room to get the additional three rooms. I understand I will need to pull a permit to add shower area in the third bathroom but would a permit be required for the three additional rooms, especially given I will not be adding any new sq ft to the property? I am thinking more from the insurance and future liability stand point. If so, what will be the typical time and cost to pull the permit for such a project. Thank you!

 A couple of things to keep in mind: you mentioned PadSplit. If you meant the company specifically and not just the concept of pad splitting, be sure they are available in your area. They actually have pretty limited reach as of now and focus primarily on major metro areas. Second, I'm a rule follower when it comes to permits. It's never worth it to cut corners on permitting because it will cost you far more in the long run. You need to make sure that your property is easily financeable if you decide to sell it in the future and any future buyer can call out non-permitted items and actually report you to the building department or, at a minimum, ask for seller concessions. If you're pulling a permit already for plumbing changes, just get the permit for the room conversions at the same time. They're not going to add much cost to the permit and you want to make sure everything you do is up to code. Just my opinion.

Quote from @Zachary Deal:

One thing to keep in mind if you are doing this is that you are likely to create "functional obsolescence" which could mean you are not able to get a new loan against your property and it can be difficult to resell as well. Basically if there is no "living room" and there are no comparable properties with similar square footage and bed/bath count in your area the property becomes difficult to comp or sell and lenders will not be able to use it as collateral for a loan

 Excellent point. If it's a simple living room to bedroom conversion, it likely won't be that difficult to return to "normal" if that's ever needed but definitely a great thing to keep in mind.

Most of my properties are already MTR, but I'd say I get more inquiries about them than I do my STR or LTR. As the popularity grows and people become more nomadic, I think we're going to see more and more of this. It's one of the reasons I love this MTR niche.

Quote from @Terry N.:

Quote from @Jamie Banks:

Here's a few things I include in my MTR lease

- Utility caps

- Outline of the furniture that is included

- Details regarding which utilities are included

- Outline who is responsible for lawn care / snow removal

- List of fees (admin fee, cleaning fee, etc)

Hi Jamie!  May I ask, what is a 'utility cap'?  And for lawn care/snow removal have you ever put some of that on the tenant? for MTR? Thanks!  T

Hi, Terry - a lot of us use utility caps. This simply means you have language in your lease that states the landlord is responsible for paying utilities up to a certain $ amount (let's say $100 for the sake of argument). The tenant is responsible for reimbursing the landlord for anything above that. Then you state how that will be collected. For example: Landlord will pay for electric, water and sewer charges up to $100 per month. Tenant is responsible for any charges above $100. Additional charges will be added to the next month's rent and due and payable at the same time. That is just example language - you'll need to use wording that is specific to your state - but you get the picture.

I stopped listening to the BP podcast when Brandon & especially David Greene shifted almost entirely into talking about mindset. That's great and all, but it's not the meat of investing. I think the podcast lost its DIY element. It's easy to cheerlead and harder to actually DO the work. I'm not saying that Brandon didn't do the work - he certainly built a substantial portfolio. But I want to know the HOWs and it just lost its way. I know he's recently shifted more towards spirituality, marriage & family content and it just seems he's gravitated away from the hard work of actually buying and selling real estate, which is why (IMO) most of us are here. So when I see an advertisement like this I feel like it would be a waste of my time and money, but perhaps interesting for others. 

Be very careful about assuming you'll be able to do a mortgage recast. Not all lenders will do this. My son is in this same position with his properties. His lender, the nationwide company Mr. Cooper, absolutely will not allow him to recast his mortgage even though he has over $100k in equity in a property where his note is less than $250k. People talk about it like it's standard and easy to do but you do not want to find out after you've sold the other property that it isn't possible so just proceed with caution.

Quote from @Bruce Tieu:

Quote from @Bonnie Low:

It's easy to get ahold of the planning department for the particular city or County you are in. Your bio says "Denver" but that could mean a lot of things and there are significantly different rules on renting out your property whether you're in Arvada, Westminster, Aurora, Denver proper, etc, etc. In many cases it is fully legal so long as it is your primary home and you occupy one of the units but definitely make sure you're in compliance before you move forward. Those jurisdictions are notoriously aggressive in researching and pursuing offenders so you want to be extremely cautious. As for furnishings, I like to see at least a slight difference in the decor otherwise when you put up both listings it can be confusing to travelers because they think they're looking at two separate listings for the same unit. You can do this simply by changing your bedding colors and the colors of accent items like throw pillows and towels. 

Additional things to consider: where is the breaker box and do both units have access to it if needed? Where are the HVAC controls and do both units have the ability to access it? Nothing spells trouble more than one unit having the heating/AC controls for BOTH units.

This property is in Denver County. I had the same thought with identical listings — it could confuse travelers unless I list them one at a time or on different sites.

The breaker box is on the outside of the house so it’s accessible. The water heater and furnace is downstairs, and the thermostat control is upstairs. They’re all accessible but would take a bit of effort to get to if there are tenants occupying both units.

It seems like this may have not been the most ideal purchase then, with the biggest problem being that it’s a single family being rented as two units. Worst case is I can still rent them as furnished room rentals, or rent the whole house as a furnished rental

Check your regulations before you give up. It really helps to speak to someone at the agency because they often will give you recommendations on how to do what you want to do legally. The biggest issue I see is control of the thermostat. Being that it's upstairs, that unit will naturally be able to control it and the bottom won't. You could solve this by using a Nest type thermostat that YOU control remotely. Let tenants know you'll keep it between a certain range of X - X in the summer or winter months. You could potentially install a mini split for the downstairs unit so they can control it themselves but that's a more costly remodel.

Ahhh...the Keurig debate. I am team NO Keurig. I fully acknowledge that people like them and I guess they're "convenient." I don't like them because a) they make lousy coffee  b) the pods are wasteful (I know you can buy reusable pods but imagine how often they get accidentally thrown away) c) they are notoriously difficult to keep clean.  The last one I say from personal experience. I just recently took one apart trying to get into every possible nook and cranny to clean it and it was GROSS. So, hard pass for me. I offer a traditional coffee pot for guests who drink a lot of coffee, a single cup pour over cone, a Chemex and even a Bialetti at my properties.