All Forum Posts by: Julie Williams

If it is market rate, it should be absolutely kosher, unless it's your spouse or a dependent child or dependent disabled family member (someone you claim on your taxes as a dependent). I suspect a spouse or dependent would fall under IRS self rental rules. Please double check with a tax accountant who works with investors or a real estate attorney, since I am neither. 

That sounds "right" @Greg R.and it IS insane. I have been trying to buy in Vermont for a while, either my own residence or an investment property. I'm paying cash so appraisal is not as big a concern. I'm at the low end of the market ($175,000 - $285,000, although I look at houses up to $300,000) and almost everything I have been interested in has closed for $10,000-$60,000 over asking. If I hear there are six offers, and there almost always are, I don't bother making an offer, and when I look it up after it closes it always has gone over what I would have paid for it. Vermont should have a giant sign over the interstate that says "Your money's not good here," LOL. They sure don't want mine. I have found homes for $185,000-$230,000 that I could afford to be very competitive on, but they weren't great and I was not willing to overpay for them. I live in coastal Eastern Massachusetts and the market is worse than Vermont here, plus totally unaffordable. Pretty much nothing under $700,000. A realtor I know here said that in Boston, you get 15 minutes in a $800,000 property (which is basically a condo) and all the offers will be over $1,000,000, all with no contingencies. I have run numbers on dozens of distressed properties and with how far out contractors are booked and the cost of materials, there has not been anything worth pursuing since December 2020, except for one CHEAP ($99,000!) Vermont property that had unreliable internet, and almost no kitchen (just a sink in a pantry sized room), which I actually kind of regret not buying. The town zoning admin called me back and weighed in positively on a deal breaker "I don't see how I can tell you that you can't put a kitchen in your barn." SO Vermont! He called me after someone else got it under contract. That answer would have made me put in an offer that would have won. The internet still would have sucked and I have not found a contractor that can start before August or September, so I would have been glamping in it for a while. The market creates a feeling of scarcity and urgency, even panic. I am trying not to succumb to it and to not buy anything unless I find a deal I would buy at another time. 

Thanks for the voice of experience, @Nathan Gesner. In my market the nurses have a choice to put the allowance towards the rental and supplement it. Rooms in homes rent for $800-$1100, 1 BR's for $1100-$2600, 2 BR's for $1200-$2800. The rents depend on the town and how nice the unit is but almost none of that is luxury housing, which starts at $3000 a month. The rents for a long term tenant are not much less, because there is an affordable housing crisis for both renting and buying. But a Bigger Pockets investor on here who has tons of rentals in Vermont says he has a lot of long term renters not paying right now even though they have jobs, and he is evicting them and turning the units in to airbnbs! 

Has anyone out there rented to both travel nurses and long term renters? Which was more profitable? Which was hardest to manage? I like the idea of renting to travel nurses, but there are always some landlords renting to travel nurses at lower prices. This is a problem because the nurses' rents always include all utilities. Other properties rent to travel nurses at a premium but they are sometimes very large and/or luxurious. Every time I use the bigger pockets rental calculators, the numbers are actually better for long term tenants. This is because the area has very high rents, and with travel nurses I have to pay for all utilities, including heat in a Northern climate, internet, garbage, lawn care, and snow removal. I could also choose to provide phone and some sort of entertainment package. (This could just be a fire stick and Netflix, though.)  If I could get enough units/bedrooms in a building, the travel nurse numbers would surpass the long term renter numbers, but those properties are larger, have a higher entry point and often need a lot of work. 

@Steven Goldman I agree that this is a boarding house. In theory, after two years of collecting rents, rents will be counted as income by a bank for refinancing purposes, but the boarding house angle may throw a wrench in that. I have been looking to buy property in Vermont (because I want to move there) and the travel nurse angle. I found out the state of Vermont defines a boarding house as more than five unrelated adults renting rooms in a dwelling unit. If it is a boarding house it requires a zoning variance and/or change of use permit whether it is a single family or a multi family with a five bedroom unit. (You may have up to four unrelated adults in each unit of a multi family without a zoning variance and/or change of use.) BUT the towns may have different zoning regulations. Just today a zoning admin shot down a project because it has three BR's and in that town a boarding house is defined as three or more unrelated adults! I had a zoning admin in a small Vermont city tell me I could not rent to travel nurses unless I lived there, and it would be a boarding house no matter what and she needed to think about whether they would allow it. NEXT. I had another town admin in a different small city tell me as long as it was fewer than five adults, go right ahead. No need to even tell me about it, just run it by the fire marshall and do whatever he says for your tenants' safety. I have had some zoning admins say I had to live on premises and some say that I did not. You have to check, town by town, if you want to rent out to a bunch of different adults, and you had better be on town sewer, too. Boarding houses have stricter rules for fire safety being enforced (like proper egress: window sizes, number and placement of exits, maximum height of egress window from the ground) and even (in New Hampshire) crash bars on the doors for quick escape! Good luck to you @Roger Simons.

@James Wenzel good advice re bed bugs. They can actually crawl into wooden furniture joints but are much less prevalent. I was an antique dealer from 2012-2016 and about half way through many of my colleagues and I stopped reselling upholstered furniture and also stopped picking up furniture from unknown sources. (Meaning free, by the side of the road, LOL.)

@James Wenzel good advice re bed bugs. They can actually crawl into wooden furniture joints but are much less prevalent. I was an antique dealer from 2012-2016 and about half way through many of my colleagues and I stopped reselling upholstered furniture and also stopped picking up furniture from unknown sources. (Meaning free, by the side of the road, LOL.)

I took a several day class from someone who is a big player in real estate investing in Texas, including owning several airbnbs they bought, renovated and furnished. (It was one of those classes that you wonder why it is so cheap, then they try and sell you a $20,000 mentorship at the end.) There was some good information, including cost to furnish and accessorize an airbnb of $10,000. They said not to skimp on mattress quality and to do high thread count white sheets like a hotel. They said to have a theme or to have fun with color and decor to make it memorable and exciting for guests. Another thing they always do is convert the garage to a bunk room, adding 4-6 guests! Of course if you are on septic, you risk blowing it out. I also wondered about towns having occupancy limits and big groups pissing off the neighbors and having them call you out to the town. Back to furniture, I became friends with a lady with a beautiful airbnb I stayed at in Rockport/Fulton Texas. She had a two family, a cottage and a garage on one property a block from the bay. The cottage was a SFR. In the two family she rented out the downstairs studio apartment and she and her husband lived upstairs, but they would also leave and rent out the whole property sometimes and even had a wedding there. (She is a minister and she officiated!!!) When I needed to stay longer term and she had bookings downstairs, she rented me the guest room in their home. She bought a lot of the furniture, which was lovely and fairly high end looking, including the furniture in the room she rented me, at estate sales. They had a hitch on their truck and an open trailer for moving stuff. I just looked it up so I could show you pictures and it looks like she sold it to someone who is renting the whole property (three units) for over $500 a night! (Look up Rockport Retreat Hot Tub Golf Cart in Fulton, TX if you are curious- but is was prettier when she owned it.) As someone who has stayed in way too many airbnb's, if you don't have a knack for decorating, or are color blind, enlist the help of a friend who has those skills or hire an interior design student. I used to do designer show homes on a shoe string budget and if you hit flea markets, moving sales and estate sales, you can save tons of money. I can't tell you how many airbnbs I have stayed in that are comfortable and functional but don't look that great. Good luck and I hope you have fun with it.

@Dave Meyer what a great idea. The only thing is, by the time the podcast airs, it will be way too late. Just had a town's zoning laws kill a potential deal. The state defines a boarding house as five or more unrelated adults living in one house or apartment, the town defines it as three unrelated adults!!! Travel nurse housing...Oh well. 

@Gini Dutt-Roye I don't own an Airbnb but I have looked in to renting to travel nurses. There is a site called Furnished Finder that is the go-to and Airbnb has a section for longer term housing. If you google travel nurse housing there are other sites. A friend of mine who is a travel nurse, mainly in Northern Vermont and Southern New Hampshire, but she has also been to Tennessee and Florida, has been looking in to buying a multi-family and renting to travel nurses. She gave up and bought a home for herself with her boyfriend. She recently said travel nurse contracts are down. I have not called travel nurse agencies, but I did call the HR department at the biggest area hospital I would be drawing nurses from. I asked them how much they are using travel nurses. It has been a huge added expense during the pandemic and hospitals, nursing homes, etc. are actively trying to pull back from using travel nurses to use permanent staff instead. The hospital said they were actively working on reducing their use of travel nurses. However, that hospital is in a very modest town with little to recommend it culturally, and I think they are going to have to use some travel nurses. Perhaps they will succeed in using fewer. In an area that people would be excited to  live in, hospitals may succeed in switching back to mostly permanent staff. It's a volatile, unusual time, and nobody really knows what will happen. The hospital was really interested in forming a relationship with me to house incoming doctors and administrators with families, because it is almost impossible to rent or buy a home in that area, but the neighborhood the house I almost bought (and decided not to) was not anywhere near nice enough for a doctor.