Quote from @Dominic Joseph Jean:
Quote from @Charlie Cameron:
Quote from @Dominic Joseph Jean:
Quote from @Charlie Cameron:
Quote from @Dominic Joseph Jean:
Quote from @Karen Margrave:
There are different types of sober living, transitional living homes. Some are basically renting out bed space and require tenants to sign an agreement to stay clean, and be tested upon request, with failing the test potentially leading to immediate eviction. There's not a lot of money in this model, it's more of a ministry.
Then there's sober living companies that get some government funding and require counseling, meetings, etc. However; the costs are high to retain all the personnel needed, etc. If the companies are large enough, and can tie down enough real estate at low prices to make them work, it can be profitable.
Either model takes a lot of commitment to run successfully. There's always drama with drug addicts and alcoholics, in addition to the stress of group living. In some areas of southern CA there are several sober living homes in high end areas. If they can make enough just to cover mortgages, with the high appreciation of the properties, it's a great investment. That's an extremely rare opportunity though.
Hello Karen,
For just renting out beds to people, is it possible to becoming financially free via sober living homes just through renting out space for people to stay clean?
The short answer is: yes. The long answer is: it's complicated and it depends. I would focus more on assisted living. The need is much much much greater and demand will continue to outpace supply. It's a demographics driven fact!
Gotcha,
Why assisted living instead of sober living homes?
Demographics, my friend! There's well over a 1 Million bed shortage right now, and due to the aging 77 Million boomers, the demand for assisted living will continue to outpace supply by over 3.5X. Most of the country has no idea what is about to happen over the next two decades. Many millennials will have no choice even if they wanted to put mom or dad into assisted living - there won't be enough and they'll have to live at home. Boomers are also the wealthiest generation of all time, making assisted living the most affordable of all time.
As far as owning a real estate related business, residential assisted living is hands down the highest and best use of a residential home, especially since you can achieve financial independence from one home.
And lastly--even though I could go on for hours--the residential assisted living model is the most impactful opportunity in real estate to get paid to do good in the world. These homes when done right are absolutely incredible and offer a level of caretaking most seniors will unfortunately never get to experience, yet deserve to.
Which niche is better for financial freedom? Assisted living or sober living homes? Also, can assisted living be in homes instead of a commercial center? My goal is to be financially free, travel the world, have no debt or college loans. I was thinking about normal residential investing. Thoughts?
Dominic, it really depends. Assisted living homes and group homes are NOT passive if you are also operating the business. They CAN be if you are simply leasing to those businesses. If the home has to meet special requirements (a common one is residential sprinklers), then you can potentially charge much higher rent and have higher cash flow on a long term lease to these operators. The challenge here is making the home ready for their business type AND finding the RIGHT operator.
If you operate the businesses as well, it is not passive at all. But the right home or group of homes can enable you to hire managers and staff to run things FOR you. But you'd have to be quite involved initially, especially to get access to better SBA lending.
The cool thing though is you can achieve 10-30K in cash flow per home. Again, done the right way. People are doing that and working 4 hours a week because they have management in place. This is much much much faster and requires far less equity than if you compared that to say traditional single family rentals.
I would challenge you though. Everyone THINKS they want financial freedom. Once they hit their "number" they usually find they aren't happy without building something and generally wind up back in the entrepreneur journey!
Hope that helps!
