Quote from @Ify (Bobby) Anizoba:
@Jarrod Ochsenbein Response:
Hey Jarrod,
First off, congrats on your success with the pad-split system! It’s great to see how creative approaches to house hacking are working well for you. I’m really interested in learning more about your experience.
I’m curious about the potential downsides and challenges you’ve encountered with this system, especially when it comes to picking neighborhoods. Are there specific factors you look for in an area to make sure it’s a good fit for this type of rental setup? It seems like location would be especially critical with pad-split (and similar systems), but I’d love to hear your thoughts on what to watch out for in terms of zoning, safety, or demand.
Also, I’ve traditionally rented out units the regular way, so I’m curious how screening tenants works for you with the pad-split (and similar) model. Are there any unique considerations or red flags you look for compared to the traditional rental process? I imagine there’s a different dynamic with tenants sharing common spaces, so I’d love to get your insights on how to manage this aspect effectively.
Thanks for sharing your experience, looking forward to learning more!
Thanks Bobby. Yes it is a different animal. My buy box is C+/B- 2000 sq ft or better, no HOA, no Pool, 2.5 bathrooms or better and plenty of parking. I first look solely at parking, since I do 8 bedrooms. If there isn't parking I don't even look at the house. The layout and the bathrooms are the next consideration. The master bedroom has to have a way to share the bathroom. I either jack and jill the bathroom or add a hallway blocking off the bedroom portion to that bath to allow access for the rest of the members.
Screening tenants is initially Padsplit. We call renters members due to the legal structure. What you would call a lease, I call a member agreement. Think of it as a gym membership where you get access to the gym. When Padsplit presents them to me as a potential member I have several questions for them. I discuss every house rule. This in itself drives off about 10% of the potential candidates. I don't look at this like loosing a member. I look at it as saving the rest of the existing members and myself headache. I would say each section has it's own set of criteria I don't budge on. Buy Box is set, class neighborhood is set (C+/B-) and rules are set.
It is working well and I don't have most of the drama the other hosts I talk to have. Part of this is the quality of the house. I charge a completive market rate while providing a really good service. I update the kitchens, floors and bathrooms to granite or quartz. Stainless steel appliances, cleaning service every other week and I am johnny on the spot with repairs.
As a result my vacancies are not that bad even with a model designed to be somewhat transitory. Generally if people are in town they stay with me till they have to go.
Everyone wins.
The downside is if you get a bad apple in the house it can and will spoil the entire bunch. This is why it is critical to vet members up front. If you don't it will bite you in the ***. I encourage anyone reading this and thinking about co-living to pay attention to this part very carefully. If you bend on this to get a member in because you want to fill the place it will bite you. In my opinion it is not worth it. Twice now over the course of a year I had it happen to me. It is flat out not worth the headache, impact to other members and having to find new members anyway to fill all the spots that left because you wanted to fill a single room.
Another down side is just in the first year or two. Lending is a fun one. This requires more than I can type here in this reply, but essentially there can be more moving parts unless you do it in a sequence.
Anyway thanks for asking. I think I will use this question as the topic for my next youtube video. I am ReiJarrod on YT. I don't think I can post links on here, but could be wrong.
Merry Christmas!
Jarrod
