Buying a boarding house
- Thread starter Elliotte
- Start date
I'm going to start a thread over in Adding Value for the updates with fixing stuff up. We got another booking yesterday, plus my Dad refuses to live with us rent free so between the two bookings already here and my Dad the mortgage is covered already which I'm happy with for the first week lol. Plus some more room inspections tonight. Sanding and polishing of four rooms plus main lounge finishes today, painting them Monday. I'm taking a couple of days now to do some fun stuff with the kid - rodeo I think, miniature railway, movies...try and keep the work/life balance.
Three rooms is covering the mortage? That is absolutely fantastic!
Apologies if it has been covered before in the thread - are you planning to have a live in manager?
Also what type of finance can you get for these type of deals? Normal commercial terms I assume?
Edit: Just re-read the first couple of pages of the thread and answered my two questions!
Good to hear that things are going well.
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just curious, what sort of people and lengths are they staying there?
im sure at whatever per night x 7, it would be cheaper to get a 1 -2bdr house if it was long term
im sure at whatever per night x 7, it would be cheaper to get a 1 -2bdr house if it was long term
I think some people like having other people around.
For others it might be the flexibility.
Most likely, the qualification for a lease may be lower too?
Some answers to questions above. I'm the live in manager for now. There are two areas of the house that are private - a section of three rooms - lounge, main bedroom and smaller sunroom that lead off the main lounge and office. It's enough space for my boy and I and we share the main kitchen - although I put a tiny kitchenette in the office for us - like a breakfast bar at least. We have one bathroom over our side of the house that we are using privately too but is a walk through the common lounge and kitchen. Down that way is also some store rooms, internal unused laundry space and another room that is all private. Plan to fix that up once all the sorting is done. We could move closer to the bathroom then if we wanted.
Eventually might aim to buy our own house but for now the place is big enough and it works well for us to be here. Shutting down the kitchen and lounge at 9pm so it stays quiet. We have so many rooms looking at setting up a late night snack room/kitchenette/TV room somewhere for the shiftworkers.
Finance was a miracle by a broker from this site and probably since my situation fairly unique any advice on that wouldn't help others. No prize for guessing I'm a high risk kind of gal so it involved chunks of money on credit card for stamp duty and business overdraft plus all my savings.
Pricing - as we have sooo much noise going on right now I am renting the unrenovated outside wing rooms for $110 a week which is share house prices around here. But no bills or bond and with wifi etc those rooms are almost all sold already - another two moving in today. The rooms are barely 7.4 m2 I think which wouldn't be acceptable these days I don't think but when it was built was okay it seems.
Indoor rooms will be $130-250 depending on size (7.5m - 16m2) and renovation and furniture quality etc. The ferals here before were all paying over $180 which is very high but they had no where else to go - no jobs, parolees, don't present well, mental health or alcohol and drug issues. And a lot of just stupid decisions - I offered all the old furniture to them free (the same stuff my son and I are now using) and they turned their nose up at the quality. They all have massive flat screens and laughed at my offer of the old TVs here. That's why they have no bond. A lot of them are now living in the caravan parks and I think that may be better than the quality they had before hand with the mess issues and living in parts of the place that weren't even proper bedrooms. The no planning is why people end up here, or short term contracts and study. Or last minute move outs with breakups etc. New migrants etc.
Latest issue is some guy left his freezer full of meat and it hadn't been defrosted so long it was a huge chunk of ice. His room had been so smelly from his sweat all I had done was throw out his blankets and shut the room thinking I'd renovate it last. Didn't check the freezer... took a few days to defrost and by the time I noticed had soaked carpets and smelt like a dead body. Cut the carpet up and it was even in floorboards! So drying it out now and the sanding guy might just have to do one room quicker than he thought!
We've now got the bathrooms to a clean level of hygiene and thrown out most of the pee/vomit/smoky bedding. Massive rubbish removal today.
Eventually might aim to buy our own house but for now the place is big enough and it works well for us to be here. Shutting down the kitchen and lounge at 9pm so it stays quiet. We have so many rooms looking at setting up a late night snack room/kitchenette/TV room somewhere for the shiftworkers.
Finance was a miracle by a broker from this site and probably since my situation fairly unique any advice on that wouldn't help others. No prize for guessing I'm a high risk kind of gal so it involved chunks of money on credit card for stamp duty and business overdraft plus all my savings.
Pricing - as we have sooo much noise going on right now I am renting the unrenovated outside wing rooms for $110 a week which is share house prices around here. But no bills or bond and with wifi etc those rooms are almost all sold already - another two moving in today. The rooms are barely 7.4 m2 I think which wouldn't be acceptable these days I don't think but when it was built was okay it seems.
Indoor rooms will be $130-250 depending on size (7.5m - 16m2) and renovation and furniture quality etc. The ferals here before were all paying over $180 which is very high but they had no where else to go - no jobs, parolees, don't present well, mental health or alcohol and drug issues. And a lot of just stupid decisions - I offered all the old furniture to them free (the same stuff my son and I are now using) and they turned their nose up at the quality. They all have massive flat screens and laughed at my offer of the old TVs here. That's why they have no bond. A lot of them are now living in the caravan parks and I think that may be better than the quality they had before hand with the mess issues and living in parts of the place that weren't even proper bedrooms. The no planning is why people end up here, or short term contracts and study. Or last minute move outs with breakups etc. New migrants etc.
Latest issue is some guy left his freezer full of meat and it hadn't been defrosted so long it was a huge chunk of ice. His room had been so smelly from his sweat all I had done was throw out his blankets and shut the room thinking I'd renovate it last. Didn't check the freezer... took a few days to defrost and by the time I noticed had soaked carpets and smelt like a dead body. Cut the carpet up and it was even in floorboards! So drying it out now and the sanding guy might just have to do one room quicker than he thought!
We've now got the bathrooms to a clean level of hygiene and thrown out most of the pee/vomit/smoky bedding. Massive rubbish removal today.
wow great story.
I have a couple of questions,
safety: from my experiences in teh area, and especially that area, combined with the type of people you had before, is it safe for you and your son????
you are obviously trying to clean up the whole appearance/image of the business, so I assume you arent letting all the bad eggs from teh previous tenancy back in???? have they tried to get back in or reapply?
note: well bloody done on your efforts so far?
I have a couple of questions,
safety: from my experiences in teh area, and especially that area, combined with the type of people you had before, is it safe for you and your son????
you are obviously trying to clean up the whole appearance/image of the business, so I assume you arent letting all the bad eggs from teh previous tenancy back in???? have they tried to get back in or reapply?
note: well bloody done on your efforts so far?
You sound like you are on top of everything.
Maybe it was a dead body
It will be certainly be a full time job keeping vacancies at a minimum, with the amount of rooms you have to offer.
Having a high turnover is never a bad thing, if you are self managing.
You can keep on top of any maintenance, and short timers usually don't make too much mess.
Maybe it was a dead body
It will be certainly be a full time job keeping vacancies at a minimum, with the amount of rooms you have to offer.
Having a high turnover is never a bad thing, if you are self managing.
You can keep on top of any maintenance, and short timers usually don't make too much mess.
Safety was a big concern TMNT. Really makes me careful when my insurance policy has exclusion on "molestation claims" Some of the guys have come back to "check their mail" and I think wanted to see we really were shut down and they couldn't get back in. So the tradies around the place and mess satisfied them that I really was overhauling the place. They don't know I've got a few rooms rented and we aren't really shut. All the door codes and locks are changed too. I have got a serial pest on the phone but he lives in Tassie and used to be here - was ringing for the last manager and I didn't change the number. When a girl answered the phone...well, I'm now getting twice nightly calls which I have learned not to answer. Only so many "My darl" slimy, drunk words I can take. The tradies here have offered to be unofficial enforcers if needed while we are getting the new rep up and running.
The actual area we are in is fine. We are in the posh, nice East Tamworth side right near the CBD. In fact our place was the one bringing down the neighbourhood before I arrived!
A post a while back detailed one of the troublemakers coming round to shake my hand and promise no dramas. Turns out the last live in manager was a sex offender according to rumour but he has left town. Dad did pick a fight with a guy in a pub who had a go about wanting to move back in and Dad told him how he'd broken out in a chemical rash getting rid of years of urine and no one would take him back and thank goodness Dad didn't get hit. I told him NOT to go stirring up trouble. To be honest, my Dad is exactly like the tenants I kicked out but related by blood so what do you do? I grew up around that type so know how to handle them to a degree I guess. I can thank my white trash background for the balls to be where I am today.
I am going with the aim of staying empty rather than ferals and making sure the first picks of guests set the tone. First guest was a dud - grandma made the booking and vouched for him but when he turned up still a bit rough. Second guest was a female student but again turned up and a bit rough. But still an improvement - first time a female has lived here in decades. Third one is perfect - Korean guy on working holiday visa. Another one arriving tomorrow. Given the place was a fairly Aryan brotherhood kinda vibe I think already hitting student, working holiday visa, Asian and female in our demographics is an improvement! Couple of backpackers arriving this week too.
Some of the guys have come back to "check their mail" and I think wanted to see we really were shut down and they couldn't get back in. So the tradies around the place and mess satisfied them that I really was overhauling the place. They don't know I've got a few rooms rented and we aren't really shut. All the door codes and locks are changed too. I have got a serial pest on the phone but he lives in Tassie and used to be here - was ringing for the last manager and I didn't change the number. When a girl answered the phone...well, I'm now getting twice nightly calls which I have learned not to answer. Only so many "My darl" slimy, drunk words I can take. The tradies here have offered to be unofficial enforcers if needed while we are getting the new rep up and running. The actual area we are in is fine. We are in the posh, nice East Tamworth side right near the CBD. In fact our place was the one bringing down the neighbourhood before I arrived!
A post a while back detailed one of the troublemakers coming round to shake my hand and promise no dramas. Turns out the last live in manager was a sex offender according to rumour but he has left town. Dad did pick a fight with a guy in a pub who had a go about wanting to move back in and Dad told him how he'd broken out in a chemical rash getting rid of years of urine and no one would take him back and thank goodness Dad didn't get hit. I told him NOT to go stirring up trouble. To be honest, my Dad is exactly like the tenants I kicked out but related by blood so what do you do? I grew up around that type so know how to handle them to a degree I guess. I can thank my white trash background for the balls to be where I am today.
I am going with the aim of staying empty rather than ferals and making sure the first picks of guests set the tone. First guest was a dud - grandma made the booking and vouched for him but when he turned up still a bit rough. Second guest was a female student but again turned up and a bit rough. But still an improvement - first time a female has lived here in decades. Third one is perfect - Korean guy on working holiday visa. Another one arriving tomorrow. Given the place was a fairly Aryan brotherhood kinda vibe I think already hitting student, working holiday visa, Asian and female in our demographics is an improvement! Couple of backpackers arriving this week too.
Elliotte,
Will you be actively searching for tenants too?
When my husband and I wanted to stay in Melbourne for a couple of weeks in 2008, I put an ad on Gumtree. A lovely lady answered my ad, and we were offered accommodation. $300 per week, and it included a basic help yourself breakfast, and use of the kitchen.
Her prices varied, depending on how long a person stayed, if all meals were provided etc.
The only thing I wished, she had 2 twin beds in the room, and just pushing them together, wasn't very comfortable. Most of her guests were single people though.
Will you be actively searching for tenants too?
When my husband and I wanted to stay in Melbourne for a couple of weeks in 2008, I put an ad on Gumtree. A lovely lady answered my ad, and we were offered accommodation. $300 per week, and it included a basic help yourself breakfast, and use of the kitchen.
Her prices varied, depending on how long a person stayed, if all meals were provided etc.
The only thing I wished, she had 2 twin beds in the room, and just pushing them together, wasn't very comfortable. Most of her guests were single people though.
Right well am too busy to start a new thread on the adding value bit. But thought you may be interested in an update.
We currently have occupancy of about 70%. Around 20-25 guests. Turnover is around $2500 a week with costs around $800 a week not including reno work. That's just interest, utilities including wifi and merchant terminal etc, insurance, consumables like toilet paper but not including any wages for me (need to work it out in better detail but accounting falling by the wayside oops). Income will go up as everyone is on super cheap rates due to ongoing renos around them for now but will stop soon.
It's only been just over five weeks since settlement. I am turning away guests as we've run out of furniture and it's a challenge to get budget furniture in town and they all lie about delivery times! We've had guests happy enough in rooms on piles of mattresses which is quite funny. I've been hitting auctions, garage sales, storage places and Bunnings and Fantastic Furniture almost daily.
Also have a bit of a bottleneck on the bigger rooms - everyone wants them so there is a wait for them. Going to have to start to insist that unless you are shagging and need a double bed then all friends will need single rooms each and not be taking up the bigger rooms and sharing them I reckon.
The more popular we get the more it's been a logic issue to work out renovating the rest of the place around the people and their movements but we are doing one last push to get last few rooms sanded and painted this week while waiting for beds. I think we'll be full in another week or two and renovated enough in all of the rooms to get us through the Country Music Festival at least.
I've given a couple of guests free rent in return for helping me and we've finally got into the swing of juggling daily cleans and check ins vs spring cleaning and clearing dodgy old parts and then building furniture etc for new rooms and co-ordinating tradies.
We are still seeing a trickle of the old type of tenant try and get into the house but I've developed a thick skin now and refuse them. We've become hugely popular with Koreans and Taiwanese who say there is some racism in town and exploitation of them and they are the main ones begging for rooms as soon as I set them up. Also a few Irish, some French, some Aussies floating about town for job interviews or contract work like HSC marking or hail storm repairs and construction projects. A family here for a kids sports event, some locals needing extra space for visiting family etc. A great mix mostly.
It's chaos, but organised. We're up and running at full speed now. Quicker than I thought to get this full, and with a different market than I thought, but what a rush.
We currently have occupancy of about 70%. Around 20-25 guests. Turnover is around $2500 a week with costs around $800 a week not including reno work. That's just interest, utilities including wifi and merchant terminal etc, insurance, consumables like toilet paper but not including any wages for me (need to work it out in better detail but accounting falling by the wayside oops). Income will go up as everyone is on super cheap rates due to ongoing renos around them for now but will stop soon.
It's only been just over five weeks since settlement. I am turning away guests as we've run out of furniture and it's a challenge to get budget furniture in town and they all lie about delivery times! We've had guests happy enough in rooms on piles of mattresses which is quite funny. I've been hitting auctions, garage sales, storage places and Bunnings and Fantastic Furniture almost daily.
Also have a bit of a bottleneck on the bigger rooms - everyone wants them so there is a wait for them. Going to have to start to insist that unless you are shagging and need a double bed then all friends will need single rooms each and not be taking up the bigger rooms and sharing them I reckon.
The more popular we get the more it's been a logic issue to work out renovating the rest of the place around the people and their movements but we are doing one last push to get last few rooms sanded and painted this week while waiting for beds. I think we'll be full in another week or two and renovated enough in all of the rooms to get us through the Country Music Festival at least.
I've given a couple of guests free rent in return for helping me and we've finally got into the swing of juggling daily cleans and check ins vs spring cleaning and clearing dodgy old parts and then building furniture etc for new rooms and co-ordinating tradies.
We are still seeing a trickle of the old type of tenant try and get into the house but I've developed a thick skin now and refuse them. We've become hugely popular with Koreans and Taiwanese who say there is some racism in town and exploitation of them and they are the main ones begging for rooms as soon as I set them up. Also a few Irish, some French, some Aussies floating about town for job interviews or contract work like HSC marking or hail storm repairs and construction projects. A family here for a kids sports event, some locals needing extra space for visiting family etc. A great mix mostly.
It's chaos, but organised. We're up and running at full speed now. Quicker than I thought to get this full, and with a different market than I thought, but what a rush.
Sounds like you're bedding it down now. It'd be nice to see some new piccies to see how it has come along.
Fantastic work!!
Send him back, we don't want him!
