All Forum Posts by: Bonnie Low

Hey house hacking peeps, 

I wanted to share some of the biggest lessons I've learned so far with my wife and I's duplex house hack. 

1) Finding the right property is VERY important for a house hack. In our situation, there were other multi family properties available, but they were either much further from the city, in bad neighborhoods, or very old outdated properties. 

IMO location is everything in a house hack. First, you will be living there, so I think it should be a place that you want to live. Second, with a better location it has been much easier to rent and we receive higher rents. Lastly, great locations open your property up to many other opportunities (STR, "MTR", etc.)

2) For your first house hack and for future investments, having a knowledgeable investor friendly team members can make a huge difference. A real estate agent with knowledge of investments, analyzing deals, knowing construction, and having crucial contacts will drastically improve your odds of success. They can connect you with other rockstar team members like lenders, inspectors, contractors, insurance, attorneys, etc.     

Where to find these agents??  Here!   Or at a local real estate meet-up is another great option.

3) IMO (duplex, triplex, quadplex) are best, butttt in some areas supply is limited. In these markets, you may need to get creative! I think there are many over looked opportunities like mother in law suites, finished basements with walk out, finished garage, or building an ADU, renting to room mates to offset cost, etc. It is still possible without small multi-family.

4) Renovations. If you do them, then make sure you are hiring a vetted professional. Get multiple referrals, quotes, and references. This can help you make the most informed decision. Your rockstar agent will likely be able to steer you in the right direction, but you can always find outside sources too. 

There will be unexpected costs that come up, so make sure you give a little cushion in your budgeting for that. 

5) Screening- Have a thorough and standardized screening process. It will make your decisions a lot easier and hopefully it will prevent you from having "bad" tenants. Also, this process will allow you to be fair in your selection process. 

Ex. Credit score 650 >

Income 3x rent

No prior felonies or evictions

xx

xx

6) Property Management - You can hire a professional and pay an additional 8-15% of your income or self manage. IMO self managing is VERY doable for a house hack or for any of your first handful of properties. The property management software makes it extremely easy and efficient.

AVAIL, STESSA, RENT REDI, BASELANE, TENANT CLOUD, etc. are solid options. Choose one, try it out, and see if it has all the features you want. If it doesn't, move on from the free trial and try the next one. 

7) STR/MTR can be a game changer. A little more set-up initially and things to learn, but once you're off and running, then your property can significantly generate more income. I would highly recommend to consider it and include it in your deal analysis for potential properties. 

I'm sure I'm missing something, but these were some of my "off the cuff" thoughts on important things I've learned. Does anyone else have any important points that I missed?

Quote from @Bonnie Low:

Quote from @Benjamin Carver:

Quote from @Ian Jimeno:

Love those numbers, Benjamin! 

I'm sure as time goes on, rents will go up and your asset will appreciate. Keep us posted on how things are going. 

I'm also moving to the MTR strategy as we go to the fall/winter seasons here in Denver. 4 months out of the year it's reeeaaal slow as an STR, but MTR strat could keep things more afloat.

Cheers,

Ian

 Thankfully I think our seasonality in Raleigh is not as severe. But MTR is a great equalizer. Another reason I like having 1 of my rooms be a monthly guest through airbnb. One couple staying for 3.5 months while the other bedroom churns every few days

Your strategy is interesting. I haven't seen a lot of people (or anyone, really) doing a combo of STR and MTR in a shared space. How is that working out for your MTR guests? Do they mind the constant turnover? And how are you cleaning in 10 minutes???

 Works really well. If they come through airbnb, they expect it. They know it functions for both. It's not listed as *only* MTR but it works out that way and I could technically set a 30 day min. 

If they are solid, they pick up after themselves in common areas, keep the dishwasher running, and treat it like a home, making it *much* easier for me to keep it clean and ready for STR guests. 1-2 a month as needed I sweep/mop/catch up however needed, clean bathroom, etc. But otherwise, a room just needs new sheets (we have extras ready to go) and towels, snacks, and then we quickly wipe and spray everything down, vacuum (doesn't always need it after every single stay) and we are out. Got it down to a science pretty much.

We have a station in a closet with 3 sets organized ready to go and a cleaning bucket with spray, wipes, dusting cloth, windex, etc.

STR turnover averages maybe every 3 days. My schedule is flexible so I try to plan it during the day when they are out at work or whatnot. But they even stop and chat with me while I'm up cleaning and I'm able to check on them, make sure everything is good and see if anything else needs replaced like TP, paper towels, etc.

Am thinking of converting a long term rental to a medium rental.  Can anyone give me a estimate of how well mediums do on average?  Curious to know how often they are vacant.  Thanks!

Quote from @Ian Jimeno:

Love those numbers, Benjamin! 

I'm sure as time goes on, rents will go up and your asset will appreciate. Keep us posted on how things are going. 

I'm also moving to the MTR strategy as we go to the fall/winter seasons here in Denver. 4 months out of the year it's reeeaaal slow as an STR, but MTR strat could keep things more afloat.

Cheers,

Ian

 Thankfully I think our seasonality in Raleigh is not as severe. But MTR is a great equalizer. Another reason I like having 1 of my rooms be a monthly guest through airbnb. One couple staying for 3.5 months while the other bedroom churns every few days

Thought I would share my experience with baselane as a warning to others.  Initially I thought it was a really good service.  As others have mentioned, the virtual accounts you can set up for each property was really intriguing to me.  I also liked the quickbooks like record keeping, that was my favorite feature.

All was going well for a few months but I ran into an issue.  The website is the only way to access baselane, there is not app to use.  And when logging into the website they force you to do a two step authentication where they send a text message to your cell phone.  The problem occurred when I had to change my cell phone number.  There is not other option to verify yourself other than receiving the text message.  So since I no longer had access my old cell phone number then I was locked out of baselane.

On June 25th I attempted to contact support to have my cell number changed in their system.  You would think this would be a quick and easy process.  Support didn't respond back to me until two business days later and then they asked to me provide some info to verify my identity (which I had already provided on the 25th) so I provided the info again.  Two business days after that I get an email saying they received my info and will pass it along to the "product team" to process the request.

Later that day I get another email asking me to verify my identity again.  I followed the instructions and did what was asked.  Next day I sent a follow-up email to support inquiring about the status of this change request because at this point I had not had access to my account or funds for a week.  They responded by asking me to be patient and informed me they are working "diligently" on the issue.  Really?  Working diligently means taking over a week to change a phone number?

So I waited patiently for SIX more days and still didn't hear anything from baselane and still didn't have access to my account.  So I emailed again on July 8th requesting a status update and didn't receive any response.  Now here we are on the 10th of July and baselane still hasn't updated the phone number, I still don't have access to my funds, and they don't even have the decency to respond to my reply.  I do like the application but obviously the customer support is lacking.  It's inexcusable to take over two weeks for such a minor update to my account. 

I went to the ATM to today to see if I could just start withdrawing my funds from the account that way but since I have several virtual accounts with funds in each one and baselane only issued one debit card for the "main" account, it won't let me pull the funds from the additional accounts. To say I'm very frustrated with this company is an understatement.  I'm about ready to file a complaint on them with the FDIC.

Moral of the story, it's a nifty application but I would be careful about how much money you keep in that account.  Luckily I still have my regular bank account and I don't keep all my funds in baselane or I would have been in a serious bind.  Proceed cautiously with this company.