Boarding at my parents - How much to pay weekly ?

[Alex P Keaton]

I'm doing a lot better health wise now. It turns out I was having a bad reaction to some medication. It put me into a deep depression.

Anyway for the past 6 months I have been thinking about moving back just so as to save a bit of cash. I'm looking to rent my unit out fully furnished and in the new year I will get some pm's to quote me how much I can expect to get in rental income. I have some holidays coming up and plan to start moving personal items to a small storage unit bit by bit and will move out end of Feb and advertise in March.

I'm going to leave everything including bed, 3 seater couch, tv, computer desk, bookcase, dressing table, chest of drawers, portable air con, fridge, microwave, linen cupboard, washing machine and dryer. I'm not sure if I should leave all my crockery, utensils, pots and pans. I'll see what the options are and how much money I can make from each otpion. I have a large analogue tv and I can buy a set top box for it. I also have an old style dvd/video recorder combo.

If I work hard at it I should be able to save at least $15,000 in the 12 months. $20 K would be even better.

 

[kathryn d]

We leave all our crockery,pots,pans etc.
We are aiming at people who travel only with their clothes and a computer (basically)
We also self manage, and not pay someone to count every little knife and fork.We have an inventory list of everything when the tenant moves in, and they have 10 days to tell us if anything is missing...otherwise they agree it is there.

When something is missing or stolen at the end, we replace it and charge the outgoing tenant.

 

[jaycee]

I'm doing a lot better health wise now. It turns out I was having a bad reaction to some medication. It put me into a deep depression.

Anyway for the past 6 months I have been thinking about moving back just so as to save a bit of cash. I'm looking to rent my unit out fully furnished and in the new year I will get some pm's to quote me how much I can expect to get in rental income. I have some holidays coming up and plan to start moving personal items to a small storage unit bit by bit and will move out end of Feb and advertise in March.

I'm going to leave everything including bed, 3 seater couch, tv, computer desk, bookcase, dressing table, chest of drawers, portable air con, fridge, microwave, linen cupboard, washing machine and dryer. I'm not sure if I should leave all my crockery, utensils, pots and pans. I'll see what the options are and how much money I can make from each otpion. I have a large analogue tv and I can buy a set top box for it. I also have an old style dvd/video recorder combo.

If I work hard at it I should be able to save at least $15,000 in the 12 months. $20 K would be even better.

How much does storage cost ?

 

[Alex P Keaton]

Not sure yet. I'm going to start making some calls next week. I've only just decided to go ahead with this so in the early stages of doing my homework. I might just get a small storage unit. I might also be able to store some stuff at mum and dads garage and in their 3rd bedroom. Even if I do have the cost of a storage unit thats fine by me. I can afford it.

Looking at realestate.com I'm thinking I'll be able to get at least $300 rent per week maybe more, maybe $350. So at a conservative figure of $300 per week, thats $1200 per month. Mortgage repayments are $1000. It it will be close to neutral. So I'll be able to save the $1000 per month.

I am going to try hard to save half my pay as well. When I do move back into my PPOR I will keep my buffer in tact! I will not make the same mistake as last time and use my own cash as part of my deposit. Then when I am ready to buy property # 3 I will be in a better position with a savings buffer of $25,000. That amount will be enough to cover repairs and expenses for 3 properites.

 

[Alex P Keaton]

We leave all our crockery,pots,pans etc.
We are aiming at people who travel only with their clothes and a computer (basically)
We also self manage, and not pay someone to count every little knife and fork.We have an inventory list of everything when the tenant moves in, and they have 10 days to tell us if anything is missing...otherwise they agree it is there.

When something is missing or stolen at the end, we replace it and charge the outgoing tenant.

I guess you learn these things as you go along dontcha. That sounds good that you self manage. For me I'll go with a PM as its a short term thing plus I dont want the hassles. Anyway each to there own hey.

 

[Alex P Keaton]

I'm actually getting quite excited about all of this. Its not like I'm really struggling from pay to pay and need to move out to stop from going under. I've managed to break even each pay and have $7 K atm which I'm happy to have achieved over the past 6 months. I saved a small amount but not that much because of ongoing expenses. I decided to do this so as to have a bit more breathing space. More SANF. Plus the added medical expenses on top of the NG was getting a bit much for me and was starting to get stressed. I dont know what future expenses there are going to be, so that stresses me out.

For the past 6 months I have managed to break even and even saved a little bit. I have $7000 now, and I could get by if I stayed in my PPOR but thought it would be a good idea to move out so as to save some money and rebuild my buffer.

If I hadn't decided to move back in with my parents I would have tried the idea of sharing with other people. But I know I get along so very well with mum and dad that this sounded like the right way to go. I'm going to try hard as well to whip mum into shape. She is trying hard to lose weight. Hopefully I can get her exercising and try to get the family to eat cleaner foods more often. It could be a win win. haha the dogs win from this too. They'll get a walk every day now. Mum doesn't do any exercise unless i'm there egging her on to do it.

Ok, so my aim will be to rebuild my buffer to around the $25 K mark and then I'll move back into my PPOR. If I focus hard this should take me approx 12 months. I could possibly get to the $30 K mark. I'll see. When I move back into my PPOR, my goal is then to keep my buffer in tact and will look to buy after 2015. I'll have to make sure though that I'm not too NG. I learnt 2 lessons from buying my first ip. Dont go too NG and have a decent buffer to see you through.

 

[weg]

I guess you learn these things as you go along dontcha. That sounds good that you self manage. For me I'll go with a PM as its a short term thing plus I dont want the hassles. Anyway each to there own hey.

You need to keep in mind that short term serviced apartments are much more expensive to manage - they are very different to a normal leased tenancy and require a lot more work. Not trying to put you off, btw.

You also need to work out the demand for this type of accomodation in your area, the type of tenants it's likely to attract (that don't have furnishings), ie. upmarket, high income, contract worker tenants will want new homewares, good air con, LCD's, decent location but will pay high rent, or if a run down place in an average location it could attract Uni students or low income earners that can't pay high rent (in which case the numbers might not be that much better than normal tenancy - unless you self manage). There are more markets. Which is yours?

Or are you looking to let it out as a furnished 'tenancy' in which case you wouldn't be paying for water, electricity, internet, etc?

 

[RumpledElf]

Ideal is to rent it to a company on a commercial lease.

Bumped into a local Nathan the other week who had picked up a bunch of houses for $30k each and is renting them out at $300pw to a company.

 

[Alex P Keaton]

You need to keep in mind that short term serviced apartments are much more expensive to manage - they are very different to a normal leased tenancy and require a lot more work. Not trying to put you off, btw.

You also need to work out the demand for this type of accomodation in your area, the type of tenants it's likely to attract (that don't have furnishings), ie. upmarket, high income, contract worker tenants will want new homewares, good air con, LCD's, decent location but will pay high rent, or if a run down place in an average location it could attract Uni students or low income earners that can't pay high rent (in which case the numbers might not be that much better than normal tenancy - unless you self manage). There are more markets. Which is yours?

Or are you looking to let it out as a furnished 'tenancy' in which case you wouldn't be paying for water, electricity, internet, etc?

I think I'm going to let it as a furnished tenancy. I guess that means I better pack and store all my crockery, pots and pans and just leave the big items. Yeah I dont like the sound of a serviced apartment.

The types of tenants it will attract.

1. Backpackers (there are a few in my complex)
2. People from overseas on working holiday (there are a few in my complex)
3. Divorced person
4. Student (TAFE is just down the street, and Esl international school 10 mins walk.)
5. FIFO workers

Property is just a 30 min walk to the perth cbd. 15 min walk to Northbridge. 5 min walk to Mount Lawley cafe strip. 5 min walk to free bus into the city. 10 min walk to train. Free parking. Visitors parking too.

If I were looking to market to someone as a more expensive rental I'd probably need to include a proper air con, new tv. Plus the furniture would most likely have to be replaced. The kitchen is renovated however the bathroom is old. So I think I'll go for those listed. Most likely a student or backpacker.

 

[Alex P Keaton]

Ideal is to rent it to a company on a commercial lease.

Bumped into a local Nathan the other week who had picked up a bunch of houses for $30k each and is renting them out at $300pw to a company.

I'll look into the company option. I wonder how fancy my furniture needs to be though. Wouldn't executive workers, or leasing to companies mean I'd have to have really nice looking furniture and a reverse cycle air con. I also dont have a digital tv. I could get a set top box.

The pluses are I have an internal washing machine and dryer. This will be hugely popular as most tenants in my complex and these types of complexes use the communal laundry on site. So there is great convenience in that regard.

 

[RumpledElf]

I'll look into the company option. I wonder how fancy my furniture needs to be though. Wouldn't executive workers, or leasing to companies mean I'd have to have really nice looking furniture and a reverse cycle air con. I also dont have a digital tv. I could get a set top box.

If you're pitching to FIFO *workers* you don't need top of the line.

Think mining people who get their hands dirty rather than top end executives in suits. Its not unusual for them to have a house supplied by the company. Out this way it is actually really common for mining companies and energy companies to rent out houses commercially and put their people in them - means they can have people on a short term basis in the area but rent the house itself out longterm.

I was going to rent our own house out as a furnished thing but the wind farm here is wrapping up and the next not starting for a couple of years so selling made more sense.