Single family rentals may be profitable but are also challenging to manage, even for some of the most experienced real estate investors. There are many challenges that arrive with single family rentals, which can often eat into profits.
In the last decade, PadSplit has become one of the top real estate investment strategies due to the higher profitability offered. The coliving homes address common pain points of single family rentals and also allow investors to make a community impact.
Here are a few ways PadSplit solves three common issues in the single family rental market:
1. Massive turn costs between occupancies
Before PadSplit: Single family rentals often come with substantial costs when transitioning between tenants. Each vacancy often requires a complete re-renovation of the home, encompassing repairs, painting, cleaning, and updates to make the property appealing to the next renter. These extensive turn costs can severely impact profitability, with landlords often spending thousands of dollars for each turnover.
With PadSplit: PadSplit reduces these massive turnover costs by eliminating the need for whole-home renovations between occupancies. Instead, only individual rooms are turned over in the home. The average cost for these room turnovers is only $100.
Additionally, the tenant pays this cost upfront, which allows the landlord to avoid more out-of-pocket expenses. This reduces the financial burden and increases profitability over time.
2. Revenue loss during vacancies
Before PadSplit: A vacancy in a single family rental property means 100% lost revenue when the home sits empty, typically for a period of at least 30 days. During this time, landlords still incur operating expenses (opex), like mortgage payments, maintenance costs, and utilities, which can add up.
With PadSplit: PadSplit is unique by offering separate room contracts. This means that even if one room is vacant, the rest of the home continues to generate revenue each month. PadSplit’s efficient system also ensures that vacant rooms are quickly refilled within an average of seven to eight days. This continuous revenue stream, coupled with minimal vacancy periods, enhances the financial stability of the rental properties while reducing risk.
3. Deferred CapEx and maintenance due to limited early intervention
Before PadSplit: Single family rental properties often suffer from deferred capital expenditures (CapEx) and maintenance issues due to limited visibility and intervention opportunities. Without regular check-ins and a constant presence, small issues can escalate into significant, costly repairs of the single family rental.
With PadSplit: PadSplit addresses this common single family rental challenge by having multiple individuals residing in the house and implementing regular cleaning schedules. This specific setup creates more visibility and allows for early detection of potential maintenance issues that develop.
With regular inspections and ongoing resident feedback, preventive maintenance is more manageable, reducing the need for large CapEx outlays and ensuring the home remains in good condition over time.
Achieve higher profitability with PadSplit’s coliving rentals
PadSplit’s innovative approach to single family rentals solves three major pain points: reducing massive turn costs, minimizing revenue loss during vacancies, and preventing deferred maintenance issues.
With PadSplit, real estate investors can now achieve higher profitability while owning properties that are maintained better. It enhances the living experience of PadSplit members, making it a win-win for both the tenant and landlord.If you own a single family rental and want to learn more info about becoming a PadSplit host, contact the PadSplit today to earn 2.5x more revenue.
