All Forum Posts by: Miller McSwain

Oh, hey @Crane Bristol. Didn't realize I was responding to you, haha. Hope things are going well!

Yo! I just wrote the BP book on Co-Living (25% off here: https://CoLivingBook.com)
I've looked pretty heavily into Co-Living insurance. Long story short, the answer is unclear as the strategy is in its infancy.

BUT, here is what I've learned.
From talking with lots of insurance brokers, you could be in the clear if they can find a company that:
1. Allows multiple leases (unspecified or 11+ in your case)
2. Allows leases that are less than 12 months and more than 1 month

I'm in Colorado (I think you might be too), and carriers that have met that criteria have been Travelers, Auto Owners, and SafeCo. 
DM me on insta and I can send you my insurance broker's info. He really knows what he is talking about in CO.

The issue is that in other areas, like guys I've talked to in Houston, TX, those particular carriers have pulled out, so instead they are having to use short-term rental policies which are much more expensive.

Also, be wary of Steadily. I've heard that they no longer cover Co-Living/PadSplit. And, I had a consultation with them last year and asked for apples-to-apples policies so I could compare premiums against my current policies. They sent back options that were way cheaper and assured me they were apples-to-apples. Upon further investigation though, I found that the hail deductible was way higher (not good in Colorado Springs as we replace our roofs every ~5 years due to hail).

Note: We don't use PadSplit. Instead we advertise for free on FB Marketplace, Zillow, etc with great success. It is unclear how insurance may look at PadSplits as they use the membership model rather than renting normally. So I can't speak to that method exactly.

Quote from @Lee Ouellette:

Quick question—when we talk about co-living platforms like PadSplit and Padshare, are we referring to an actual application or just the model? I have two properties I’m looking to convert, but Padshare isn’t available in my area. What platform or system are you using to handle listings, tenant placement, billing, and contracts? 

 You can totally run Co-Living properties outside of PadSplit. They are basically a listing platform, but there are LOADS of other listing platforms that are free.

We list mostly on Zillow, Roomies, and FB Marketplace.

For rent collection, lease signing, etc, we use Innago. But a lot of the property management software are great (RentRedi, TurboTenant, etc)

If you really want to get into this, I have a 1000% free Facebook community I'd love to have you in. We do monthly calls where we look at deals, review floorplans, solve tenant issues, etc. And there are lots of newbies and experts in there asking/answering questions every day!
https://millermcswain.com/community

Hey! I actually just wrote the BiggerPockets book on Co-Living (25% off here https://CoLivingBook.com)!
Personally, mine are in Colorado, BUT I'm literally looking for some in WA right now. From my research so far, WA state law prevents cities from setting occupancy limits on single family homes. This is the main regulation that can block Co-Living, but WA is good to go on that front!

Analysis of Co-Living is similar to long-term-rentals. Just be sure to include the added expenses (utilities, wifi, cleaner, shared supplies, etc). Happy to chat about it more!

Quote from @Andrew Kubik:

What system do you use to manage co-living arrangements? Do you have to use a platform like PadSplit or can you manage it through something like Rentvine? 

 PadSplit is mostly a listing service (like AirBnb). They charge 13-25% of gross rents, and in exchange, you get to list on their platform. They do have some management features like rent collection and agreement signing too.
But instead, we have been able to pretty easily find applicants on FREE services like Zillow, FB Marketplace, and Roomies. Then we do the rent collection and lease signing through Innago (also free). You could use something else like RentRedi though, they are all pretty similar.

Quote from @Luke Tamez:

How did you find out what would be the going rate for rents per room.  Was there other people around you who were doing the same?  Also for the houses you purchased and your not living in them did they have to be non restricted houses?  Wouldnt it be a multi family and if its a deed restricted community they may say something,  How did you get around it ?

I actually built a "Rentometer for rooms" type tool you can check out that estimates room rents: https://CoLivingPro.io

Otherwise, you can look up what rooms are going for on places like Zillow, Roomies, and FB Marketplace in your city!

When buying houses I don't live in and rent out the rooms, the classification depends on the city/state. Everywhere I invest, the regulations say that a singlefamily home can have unlimited unrelated persons. So no issues there.
In some cities though, you'll find regulations that say a single family home is no more than 5 unrelated persons (or something similar). So you'd want to be mindful of the number of people in a market like that!

I am a Co-Living investor (and recent BiggerPockets author about the strategy :)) in Colorado, and I am interested in using this strategy in WA also, since it seems to have favorable Co-Living laws.
Looking to connect with anyone who has experience with room rentals in Washington or knows someone who does!

Quote from @Michelle Verdugo:

Quote from @Miller McSwain:

Quote from @V.G Jason:

When did you buy the properties? At what interest rate(if levered)? And at what average house price? What's your net income per tenant(after the nonsense) per month?

The first was in 2022 and am closing one this week. Over that time, 4% interest was my lowest, with some 8.5% as my highest. The one we are closing now is 7%.

In my market, our avg purchase price is ~$500k.

The cash flow (after the nonsense 😂) is typically ~$2000/month, which is usually around 12-14% cash on cash! This new one is $3000/month though (projected) :)

 How much do you put down for downpayment?

 Lower is better as it usually increases your cash on cash return. So when we have house hacked and rented the rooms, we always put 5% down. On the properties that we didn't live in at all, we've done anything from 15% to 25%. We'll usually just do the lowest that the lender will allow!

Quote from @V.G Jason:

When did you buy the properties? At what interest rate(if levered)? And at what average house price? What's your net income per tenant(after the nonsense) per month?

The first was in 2022 and am closing one this week. Over that time, 4% interest was my lowest, with some 8.5% as my highest. The one we are closing now is 7%.

In my market, our avg purchase price is ~$500k.

The cash flow (after the nonsense 😂) is typically ~$2000/month, which is usually around 12-14% cash on cash! This new one is $3000/month though (projected) :)

Quote from @Joe S.:

Quote from @Miller McSwain:

Yes! Stoked to answer anything and everything Co-Living!!!!!

Any reasonable price management if a property owner did not want to manage it themselves? 

 ~12-18% management fee is what I've seen. People do make the numbers work with that fee included. Personally, I self-managed and then hired a virtual assistant to follow the sytems/procedures I created. I just did the math and that works out to be around 2% of gross rents that I pay to them for their time ($10/hour)