All Forum Posts by: Jason Tucker

Hi BP- 

buying my 3rd multi-unit property.

I’m putting a contract on a 4plex

I’d like to understand which financing option is better:

Option 1 - Residential loan- 7.99%, 30 yrs, 25% down. 3 points at closing plus 2% closing cost. monthly Mortgage is ~ 1800 Under my name.


Option 2- Commercial loan. 7.75%, 20yrs, 20% down. 5 year balloon payment. 1% for closing. No points.
monhtly mortgage is ~ 2100. Under LLC

Option 2 is 13K less for closing. But also lower cash flow every month.


Any other suggestions on how to analyze the deal. I’d like to use the 13k to buy another property. But don’t like the 5/20 or the lower cash flow.

Thanks!!

@Jason Tucker Yes, you can't turn them away because of their sex but I've seen some investors who have multiple rent by the room properties "refer" someone to one unit vs. the other. Travel nurses, for example, tend to be female and like being in female only accommodations from the feedback I received. Just something to think about as you're getting started and deciding on logistics. 

Hi Jason,

I know a lot about co-living, feel free to ask any specific questions.

Sounds like you’ve got a solid plan for the building. Where is it? What’s your plan for property management? Who will be doing the showings? “Selling” a co-living room is very different to showing a traditional unit.

Are you planning to furnish each unit entirely or just the common areas? That will impact the price you can get. You may come across pushback with having co-gendered units so as you grow I would suggest leaving room to have unit(s) that are male and female only for those who are more comfortable with living with others from the same gender. 

@Jason Tucker Thats a good setup for what you are talking about. If you do more than one unit this way make sure you don't need a boarding house license in your town.  Are you setting a one person per room limit?  I am curious to get an update after you launch.

@Jason Tucker  you need to add in your utilities, common area cleaning, and turnover costs to determine if it makes sense.  Expect higher turnover as people renting rooms tend to move. The other thing is does your room rental have a setup that links each room to a bath. Because an attached bath vs a hallway bath that is theirs might make a difference.

@Jason Tucker, I'm familiar with co-living single-family homes but not an apartment complex per unit. What do the numbers look like if you were to rent the units out traditionally vs. per bedroom? With this strategy, who would be responsible for utilities? Does each room have its own private bathroom or is there a shared hall bathroom? This could be a great cash-flowing asset but you're also assuming a lot more risk with this structure. I would recommend working with an experienced co-living company such as PadSplit or HomeRoom. I have contacts with each company that I would be more than happy to connect you with. If you are interested, please shoot me an email or text to connect (contact info is listed in my bio). Just curious, where specifically is your apartment complex located?