April 06, 2023

Banana Bungalow Bliss: How One Couple Turned Their Long-Term Rental into a Mid-Term Dream

Scott and Jeanalin Rehm finally decided to convert their long-term rental into a mid-term rental after debating it for years. Their casita, lovingly called The Banana Bungalow,needed $60,000 in renovations and remodeling, which scared them, but their fears were allayed when their property was rented after only one day on Furnished Finder.

Originally, they intended to use the short-term rental strategy, but Las Vegas, their hometown, was enacting short-term rental regulations, which dissuaded them. Additionally, the mid-term rental market appeared to be thriving and trending, so they intended to use that rental strategy going forward.

They chose to decorate their casita with the intention of making every aspect of the property "Instagrammable," or full of interesting, eye-catching photo opportunities worthy of sharing on social media. They also intend to list their property on Peerspace so that people who need a home or location with content creation potential can find it.

The Banana Bungalow, a 312 foot casita in their backyard, is completely food-themed and full of thoughtful touches. An overarching color theme of yellow, pink, and green can be found throughout the house. Shower heads and faucets are integrated with led lights that illuminate the water based on its temperature (ranging from blue to red), and the shower head has a bluetooth speaker built right into it.

The kitchen is completely customised, with a yellow Samsung refrigerator and a gold sink. Unique art installations inside and outside the home, a fire pit outside, a hammock, shade sails, and a sprinkling of banana themed decorations throughout the home all contribute to the home's unique and fun vibe.

Decorating with themes or making bold furniture choices can help a property stand out among other rentals and stay in the memory of a potential tenant. A distinct and well-executed theme can help distinguish a property and make it more memorable to renters. It can also give the property a sense of character and personality, making it more appealing to renters.

The Goal for the Banana Bungalow

Their cash-on-cash return is 16%, so they should be able to recoup their initial investment in the property in less than three years. They know they could raise rent and be able to pay off their initial investment more quickly, but they want to provide an affordable, memorable, and unique property for travel nurses without pricing them out of their property.

It can be difficult to determine when and by how much to raise rents, but FurnishedFinder.com provides tools to assist property hosts with this task, such as a free tool to determine the travel nurse demandin your area and a tool found within the property host dashboard that shows how your property is performing in comparison to other properties in your area.

If you are a property owner who is concerned that the rent you intend to charge will deter potential tenants, keep in mind that when it comes to renting a property, location, amenities, and overall condition are all important factors in determining the rent. By highlighting these features and offering more services and amenities, you can help potential tenants understand why you can charge a higher rent.

Some inexpensive ways to justify higher rent include the following:

  1. Highlight the property's location and amenities: If your rental property is in a desirable area or close to public transportation, shopping centers, or other amenities, make sure to highlight these features to potential tenants. This can help justify a higher rent by demonstrating that the property is in a desirable location with easy access to essential amenities. Don't forget to mention how close your property is to medical care facilities.

  2. Provide extra services or amenities: Consider providing extra services or amenities to tenants that are not typically included with rental properties. You could, for example, offer landscaping services or access to a community pool or fitness center. This can show that your property is more than just a place to live, which can help you justify a higher rent.

  3. Promote the property's distinguishing features: Highlight any one-of-a-kind or special features of your home, such as a balcony, a backyard, or other outdoor spaces; a unique floor plan; a remodeled kitchen or bathroom; high ceilings; or any other feature that sets your home apart from others in the neighborhood.

  4. Mention the level of maintenance and cleaning: emphasize the level of care and maintenance that goes into keeping the property in good condition, including regular cleaning and maintenance of common areas. This can help justify a higher rent by showing that tenants will be living in a well-maintained and clean environment.

Advice for Anyone Nervous About Jumping into Midterm Rentals

Starting a new business, especially one as large as real estate investing, can be frightening. Having a supportive partner, on the other hand, can make all the difference. Having someone who understands your motivation and is willing to assist you in navigating the process can boost your confidence and empower you. One important piece of advice for anyone thinking about getting into midterm rentals is to educate themselves on the importance of debt management.

Both Scott and Jenalin taught Dave Ramsey's Financial Peace University at the church for a little while. They agree that it is a fantastic resource for learning how to get out of debt. The program focuses on budgeting, cutting expenses, and paying off debts. When it comes to real estate investing, however, it's critical to understand that leveraging debt can be a powerful tool for growing your portfolio and creating cash flow.

Scott emphasizes the importance of becoming comfortable with leveraging debt. This entails obtaining loans and other forms of financing in order to purchase property, renovate it, and generate rental income. Leveraging debt can assist you in acquiring more properties and increasing your cash flow faster than if you paid for everything in cash. It is critical to use debt wisely and to have a plan in place to effectively manage it. If you're hesitant to enter the world of mid-term rentals, keep in mind that education and support are important and available. Be sure to check out Furnished Finder's free online resources available to property owners.

A Multi-Faceted Approach to Investing

Scott and Jenalin got their start in real estate by using the "live and flip" strategy. The "live and flip" strategy entails purchasing a home, living in it for a set period of time, improving it, and then selling it for a profit. This strategy is popular among investors who want to better understand the local real estate market and increase the value of their property before selling it.

The primary benefit of the "live and flip" strategy is that it allows investors to get a feel for the property and make any necessary renovations or improvements to increase its value. This is especially useful in areas where property values are rising, as it allows investors to capitalize on that growth. However, there are some drawbacks to the "live and flip" strategy. For example, the real estate market can be volatile, and the property's value may not rise as much as the investor had hoped. Furthermore, living in the property can be disruptive and cause the flipping process to be delayed.

Ohana Senior Living, their memory care home, also known as a residential assisted living home, is yet another business endeavor of this entrepreneurial couple. Having gone through difficulties with his father being bedridden, Scott knows firsthand how important it is to provide seniors with a quality home to live in and still receive the quality care they need. So when they decided to start this business, they knew they would genuinely be helping not only their future tenants but also the families supporting them. They have a house manager to handle the bulk of the day-to-day work.

In addition to their real estate endeavors, as members of the Investment Club of America, Scott and Jenalin have been learning a lot from seasoned investors as well as about investment opportunities they never knew were available to the public, such as investing in documentaries and gyms.

Accessory Dwelling Units

Scott and Jenalin plan on converting the garage in their home into an ADU (accessory dwelling unit) and plan on naming it "The Coconut Casita."

Converting a garage into an accessory dwelling unit (ADU) is a great way to add more living space to a property, but it's important to know the costs, laws, and rules involved in the process. Before starting any work, the first step is to check local laws and regulations to make sure that the conversion is allowed in your area and to find out if there are any zoning or building code requirements that must be met. This can be very different from place to place, so it's important to do your research ahead of time.

Once you know the rules and laws in your area, it's important to do a thorough inspection of the garage to make sure it's structurally sound and can handle the added weight and stress of living quarters. If the garage is in bad shape, it might not be worth the money to turn it into a room. After you decide that the garage can be turned into an ADU, you should hire a professional contractor who has done ADU conversions before. This will make sure the job is done safely and according to the rules.

The contractor will also help with the design and layout of the space. He or she will make sure that the end goal is to create a space that people can live in and use.

Making a garage into an ADU that is comfortable to live in is one of the hardest things to do. Most garages aren't insulated, so you'll need to add insulation and weatherproofing to the walls, roof, and windows of the ADU to make it comfortable and energy-efficient. Also, garages don't usually have plumbing or electrical systems, so it's important to add these to the ADU to make sure it has power and water.

When decorating the ADU, it's important to focus on adding finishes and fixtures that will make the space comfortable to live in and appealing to people who might want to rent it. Often times, a converted garage is "acceptable" as a living space and does not generally stand out as impressive. If you can think of ways to make your ADU Instagrammable—that is, something about it is incredibly unique and eye-catching—you will position your property well in the rental market.

Also, you should think about zoning and parking. In most places, ADUs must have a separate entrance and parking that is not on the street. Check the local zoning laws to make sure you have everything you need. And finally, make sure to get all the necessary permits before starting the conversion process. This will make sure that the finished product is safe and up to code.

In the end, Scott and Jeanalin Rehm's story is a great example of how creative thinking outside the box can help a property owner turn a long-term rental into a mid-term dream. By turning their backyard casita into a unique "Banana Bungalow" that looks good on Instagram, the couple is able to attract a wider range of renters, get a high occupancy rate, and get their money back in less than three years. Also, using the tools on Furnished Finder helps them figure out what the local market will allow when it comes time to adjust their rent. If you own a rental property and are thinking about doing something similar, this story is a good reminder that a well-done theme and bold furniture choices can help a property stand out and make it easier for renters to remember.

Listen to the Podcast here

www.furnishedfinder.com

Author : FF Staff