Buying a boarding house

It's in an area where boarding houses are allowed usages and as I'll be getting first boarders in within a month of taking over there won't be any issues anyway. Even if after a week or so we only have four or five rooms ready to go that's enough to cover costs. A deep clean and rubbish removal and yard cleanup and we'd be okay to start up again with hand picked tenants on cheap rates who don't mind us working around them on areas.

Fire safety is an issue - we have to pretty quickly put on fire doors and do a wired fire alarm system that's monitored. Probably a cost of around 50K looking at quotes so far but hoping council will give us a few months to get it sorted. There is also a grant available for that but I think will pay back over five years but we might see if we can qualify for it.

Somebody called the health inspector last week. Owner and manager blame me as a tactic to reduce price but it wasn't. I suspect tenants dobbing in their own mess in hopes a sale can't happen. Revenge on the owner for sale. All very ugly but the up side was both the owner and manager yelling at council inspector on phone and in person. So when I rang all professional to figure out what the issue was and made it clear it would all be different they were the most pleasant conversations ending with "Council is here to help and can't wait to see the place enter modern times and look forward to working with you blah blah". I'll next be talking to police to they are aware of what is happening over next month leading up to settlement.
 
Elliotte, I take my hat off to you. The closest to boarding house I have had exposure to, is where people have student accommodation. Your venture is up a scale or two. And also to you Kathryn, as I gather you also have multiple tenancy accommodation. As I see it, that’s a real business, and the more hands on you are, the less problems you may have, until you have it all set up and then you can have a lot delegated. I do believe cash is king, so the more cash that you can generate from an enterprise the better you are, however you must balance that with the value of your “hourly rate” and lifestyle. So far it sounds like you guys have it pretty right.
 
Peterw said:
Elliotte, I take my hat off to you.
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+1 for that - if you have the brains and balls for this kind of deal then u deserve the pay check. I like the thought of this kind of thing one day, but havent even tried student accom yet so maybe its baby steps...
 
Peterw said:
Elliotte, I take my hat off to you. The closest to boarding house I have had exposure to, is where people have student accommodation. Your venture is up a scale or two. And also to you Kathryn, as I gather you also have multiple tenancy accommodation. As I see it, that’s a real business, and the more hands on you are, the less problems you may have, until you have it all set up and then you can have a lot delegated. I do believe cash is king, so the more cash that you can generate from an enterprise the better you are, however you must balance that with the value of your “hourly rate” and lifestyle. So far it sounds like you guys have it pretty right.
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Thanks.
The closest we have to a boarding house is an 11 unit building with furnished, all inclusive bachelor suites. Each unit has a private bathroom and kitchen and of course a bed in the room.Self contained little units.

We started out renting only to uni students, and then it gradually came to be a place for relationship breakdowns, job transfers,building a home,first time renters etc.

We have very few problems with this building, compared to family units.

The strange part was when we did the property development on this property.
We could have just rented it to anyone as a rooming house without doing anything.
We instead chose to go the bachelor apt route, and then had to firewall every unit, upgrade the electrical and plumbing, have wheel chair accessibility etc.

We made the right decision, because it made it safer...and we get more rent.
 
Countdown to settlement is on! Here's hoping it goes smoothly. Tenants have been given notice to leave. One or two of them are staying on as "security" for the few days after the owner leaves and before I get there for pre settlement inspection. Spirited discussions between owner and I over who we would both agree on - picked a short term guest/school teacher. Owner is still arguing that all of the guys are fine, just misunderstood and that I should take them all. I mean yes, the temptation is just to walk into the business with it earning $3000 a week but short term pain for long term success I think is the way to go and have it empty. He just wants me to be the ones to have to shift them. Not happening.

If everything goes to plan I may be there within two weeks!! Been busy getting everything ready to go - furniture, linen, bathroom supplies, cleaning supplies, logos, marketing, web site, quotes for repairs and fire upgrades...all of it on hold until I open the front door then a million deliveries will be triggered and a lot of virtual assistants mobilised and a few dozen quotes activated.

My last guesthouse I went from signing lease to fully booked, furnished and up and running breaking even within 7 days, profit within a few months (would have been weeks but I did some renovations). So I've got high expectations for myself.
 
Sure do! A great/stressful time is being had by all.

Thursday 12 noon - arrive in Tamworth. Had arranged to move into the place 24 hours early to do pre inspection and settle in. Also to confirm all vacant and no damage. Find one squatter who leaves within the hour with no fuss but left a trashed room. Had agreed with vendor to allow another guy to stay until settlement to be in charge of keys. Meet him.

2pm - Tenant in charge of keys starts an argument about why he should be allowed to stay on. Lots of passive aggressive chat later and he agrees to leave by Monday.

Rest of Thursday - our stuff unpacked and an area sorted for my son and I, plus my Dad. Dog proof the yard (which still isn't perfect and dogs keep escaping somewhere). Get the keys and open up all 30+ rooms and locked areas and inspect. Check to make sure phone and wifi are all working and transferred in my name. Get a few basic groceries, walk around town, join the town and get a library card for my book mad 4 year old.

Friday

List everything I want gone on Freecycle. Show the first nosy neighbours through who turn out to be on town council so that's a bonus. They are lovely. Set up my office. Order all the marketing materials now I know the phone is working and we have the same phone number.

2pm. SETTLEMENT HAPPENS!
2.05pm. My son smashes something so thank goodness I own the place. 2.10pm - the phone rings and someone wants a room for Saturday. We explain the situation about not being open, everything a mess and they are still keen. 2.30pm. Someone rings the doorbell and wants a room. I decline as I didn't think we'd be able to patch together two functional rooms so quickly.

Rest of afternoon is spent making a "Frankenroom" - picking a spot with less stained carpet, grabbing bits of the best surviving furniture, digging around for all the supplies in this horders paradise.

About 3pm crack it with my son getting underfoot and do a last minute tour of the closest daycare centres. He is enrolled and starts Monday!! He seems pretty eager to be around kids and with toys and sandpits so I don't feel too guilt. He did go three days a week in Sydney.

Asleep by 6pm and up again at midnight as some guests from Sydney guesthouses arrive with another carload of my personal stuff. Had traded a few nights free accommodation and petrol money.

Saturday

Off to Bunnings for some paint. A dozen families come through the house and take some of the giveaway furniture. Our first guest arrives. Major grocery shop. Give away a massive freezer full of meat to locals for their dogs - no idea how long it's lived here and if still okay for humans. Explore local parks. Have the list of priorities done with what rooms need what work, what can be used first etc. Start to get quotes for sanding, painting, rubbish removal.

Sunday

Kid is cracking it with the new place, no attention blah blah so morning in the play centre. Empty out the lounge room ready for sanding and make a nice verandah living space instead for now. Start shoving mess into rooms that are at the lowest priority as guestrooms so the place looks habitable if you don't open doors.

Tomorrow - think we should be able to cobble together at least three rooms that are then rentable .More furniture giveaways, more quotes, visit to the ladies at the information centre to say we are here and ready to go - I visited them when doing DD and they had spread the word from what I've heard anyway. My son goes to daycare. We also have first live in helper arriving on the train - 2 hours work a day for a room.

In the meantime my Dad had travelled up with us but has found the size of this place overwhelming (1200m2 with almost the whole block covered in buildings and rooms) that he has just been drunk pretty much since Thursday. I've been pretty angry but it's had a few good side effects - he has come home from the pubs with pockets of business cards of people keen to see us do well - local fire chief etc.

Also this afternoon was almost asleep on our verandah the guy who first abused me when I did the building inspection turned up. He'd heard somehow (Dad drinking?) that I'd been really upset and scared by his verbal abuse and had come to apologise and wish me well and assure me that him and the other guys wouldn't vandalise the house or cause any trouble in town for me. Shook my hand and all. Then asked if he could have some furniture ha ha.
 
No agent Truly Exotic - private sale.

Will post photos as I go. I've got started to clear out the old linen - the pile is over 2 m tall and a few metres wide at the moment to throw out and isn't even 1/3 of the place done. And the quotes have started on rubbish removal. My Dad is not drinking and painting the bathrooms. Son is happy at new daycare. Last troublesome tenant just packed his car and drove off. It's peaceful.

This is a few photos to get you started. What we saw during inspection.

https://www.facebook.com/media/set/?set=a.10152942194135179.1073741826.754860178&type=1&l=3b09bc0735
 
Elliotte said:
Sure do! A great/stressful time is being had by all.

Thursday 12 noon - arrive in Tamworth. Had arranged to move into the pl
In the meantime my Dad had travelled up with us but has found the size of this place overwhelming (1200m2 with almost the whole block covered in buildings and rooms) that he has just been drunk pretty much since Thursday. I've been pretty angry but it's had a few good side effects - he has come home from the pubs with pockets of business cards of people keen to see us do well - local fire chief etc.
.
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It's a interesting old money Town ,,Tamworth and with what your Father has done is very smart because everyone knows everyone and everyones
business at different levels and some come with far reaching impications with consequences that sometimes you never see in the start..good luck..
 
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