Room Rentals
Does your property struggle to cash flow? With interest rates the way they are, it may seem like it makes sense to sell right now but what if I told you there is a solution to your cash flow problem and you can actually afford to preserve your investment and weather the storm?
Room Rentals
Room rentals is a concept that has exploded in the US residential real estate market but no one has yet to popularize it in Canada. Rooming houses are not a new concept, but they have never been professionally managed or properly marketed…until now.
The idea is converting living spaces such as living rooms, dining rooms, etc. into additional bedrooms. For property owners, that means a significantly higher rental income and for tenants, it means a more affordable way to live.
Traditional rentals are out of reach for lots of Canadians. In fact, the average rent in New Brunswick is up 28.7%, the largest increase in the country and residents in Moncton are now using 11.3% more of their wages to pay rent compared to 2018, also the largest change in the country.
Room rentals provide a much better fit for the rental landscape in 2024 and beyond, especially for middle to low income tenants.
Top 3 reasons why tenants prefer room rentals
1. Ability to move-in and out fast (usually within 48 hours)
2. Affordability (40-50% cheaper than traditional rentals, ~$600-800/month)
3. Flexible lease terms (no more long-term commitments)
What do the numbers look like?
Assumptions:
1. Rent: 7 bedrooms at $600/month
2. R&M: +140% ($125 to $300)
3. Insurance, Misc.: +48% ($540 to $800)
4. Utilities: In the room rental model, the owner pays for utilities ($550)
5. PM Fee: We charge 13% for room rental properties ($544)
In this example, a 4 bed 3 bath is converted into a 7 bed 3 bath that brings in +2.5x rental income and +2.3x net operating income even with the added operating expenses of a room rental model.
The ideal property for a room rental would be either a single family house or a semi-detached, duplex, triplex with units that have a lot of living space in a B or C class neighborhood.
Check out our room rental presentation that we have used for educational webinars and real estate events to learn more here!
Get to know us more with our marketing booklet here
To get in touch, feel free to call us at (506) 704-5026* or schedule a quick 10 min call here
Interested in having us manage your property? Let's get started by filling out this intake form here
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