Quote from @Garry Lawrence:
Hey everyone,
I’m 19 and about to close on my first rental property! It’s a fully renovated, modern-styled, 2-story townhouse with 3 bedrooms, 2 bathrooms, and a basement in Baltimore County, where I live. I got the property off-market for $250k from a trusted family friend. It’s less than 15 minutes by car from two major universities (Towson & Morgan) and just a 7-minute walk from a shuttle that services both campuses.
I plan to rent the property by the room, targeting mainly college students due to its proximity to the schools. With 4 rentable rooms (including the basement), I expect to generate $3,600/month with full occupancy. My mortgage will be $2,005/month, and I’m budgeting up to $600/month for utilities, leaving a potential monthly cash flow of $995.
I also set up an LLC and a business account to track rental income and expenses.
Questions:
- Do you have any advice for me as a young real estate investor?
- Do you think my age will impact my authority as a landlord?
- I’m debating whether to furnish the shared areas or just stage them for photos and viewings. Which would you recommend?
- I plan to put a $600 utility cap in the lease. Is this a good or bad idea?
- What are your best tips for screening tenants, especially for student renters?
- Are there any specific clauses I should include in a room-by-room lease for a shared living space?
- What property management software or tools would you recommend for tracking rent payments, leases, and maintenance requests?
- Based on the numbers and my strategy, do you think this is a good investment for my first property?
I’m excited but also know there’s still a lot to learn, so I appreciate any insights you can share. Thanks in advance!
Hi Garry, congrats on your first investment property! That's seriously impressive for a 19-year-old! Let me break down some advice for each of your questions:
1. As a young investor, stay organized, keep learning, and don't be afraid to ask for help. Network with other local investors and always have a solid emergency fund.
2. Your age might raise some eyebrows initially, but as long as you're professional then you should be good. Be direct, have clear communication, and show you're serious about being a good landlord.
3. I'd recommend partially furnishing common spaces. It makes the property more attractive to students and can justify slightly higher rent. Think basic, durable furniture that looks good but can withstand college life.
4. I'm not familiar with your market but $600 should be reasonable. Just be super clear in the lease. Include specifics about what's covered, overage charges, and how you'll track/bill utilities. Consider splitting utilities or using a utility management service.
5. Require co-signers (like their parents), check references from previous landlords or college housing, verify enrollment status, and personal interviews to gauge responsibility.
6. Maybe you can add clear rules on noise, guests, shared space usage, cleaning responsibilities, maintenance expectations, and specific guidelines for shared bathrooms/kitchen.
7. For a simple/budget-friendly option, Google sheets/Excel can actually be a great starting point.
8. Again, not familiar with your market but your numbers seem conservative, which is smart. Just be prepared for potential vacancies.
My advice is to build relationships with university housing offices. They can be great referral sources for responsible student tenants.
Best of luck with your first property! Happy to connect and answer any questions you may have.
