You're listening to Carrie Lutz's Financial Survival Network, where you get valuable information you
just can't find anywhere else to thrive in today's trying times. You need the
Financial Survival Network now more than ever. Go to Financial Survival Network dot com
and get your free newsletter in gift Financial Survival Network now more than ever,
And welcome you are watching listening to the Financial Survival Network. I'm your host,
Carrie Lutts. Well, there's a lot of ways to make money in
real estate that you could just buy homes or condos and rent them annually monthly.
You could do short term vacation rentals, but what about Airbnb without the
baggage, without the luggage for a longer term commitment, You're still going to
make more cash flow, and effectively you get the benefits of Airbnb without the
burdens I'm talking about. My next guest is Johnny Wolf and Johnny, your
site is live homeroom dot com. And if I have it right, basically
you provide investors of means of renting it by the room rather than by the
home effectively. And I know you came from Boston and my son lived in
Boston for a while a lot of people, especially when they're attending university,
you're just looking for a room to rent. So with that introduction, here
tell us about about your evolution. Here how you started this business. So
I am start my career in the Silicon Valley as a financial analyst and I
but you know, early in my career, I thought it'd be great to
invest in real estate because it was, you know, buzzy everywhere thinks real
estates the answer to generating wealth. And my first property I did, okay,
not amazing. It was in Midland, Texas, but I learned real
estate and started to analyze it, and I realized over the next five to
seven years, after about a number of other properties, that real estate was
the investment strategy I wanted to use to kind of build out my burstal net
worth. So I moved to austin twenty fifteen and invested in a number of
single family homes and rented each out by the room I'd lived in remained houses
in San Francisco for a long time, and so I thought it just made
sense, and I was able to get quite a bit more rent in some
cases fifty percent more, some thirty percent more. It was a bit more
work, but you know, at the beginning of your real estate kind of
investment, kind of push, you know, every dollar matters. So I
did that across Austin and then Kansas City, and a few of my friends
said, hey, how do I invest like this? It seems like you're
doing really well. And so then Homer was born. So we started in
twenty eighteen. We now have twelve hundred rooms on the platform where people can
help. We help people find homes or on board their homes on our platform
to rent them out by the room for up to fifty between you know,
alurgeen thirty five to fifty percent more rent for the same exact house. Interesting
and uh okay, so um, Obviously there's more management. It's more management
intensive when you have three people, say renting a three bedroom home than just
one person renting an entire house. But what does that look like in terms
of actually doing this, actually running your properties? Yeah, yeah, more
more labor intensive, as you know, as an understatement, I think you
know the spectrum of single you got your single family homes, it's pretty straightforward
annual leases. Any syndicated side can get you a renter and then the leases
are standard and then you got on the other side, you've got your short
term rentals where it's people are moving in and moving out. You got to
furnish it. You've got star reviews to worry about constantly. Um it's super
heavy management. And there's companies like for Costa, we charge like forty you
know to run those for you because it is really really hard and I think
we're kind of in the middle, right. We we get you more rent
but the average people sign on for a year. There is some you know,
roommate dynamics that we manage I think, as you know, really well.
But it so it costs cost a bit more. But yeah, we
we vet people. We you know, we have pretty aggressive leasing and marketing
team. For tenants, we have a really nice onboarding team as well as
a roommate and house management team. We provide like main service, yard care.
You know, there's some things with shared housing that if you don't you
don't do essentially then it may or may not get done. For example,
the lawn getting mode. And we found that when the lawn doesn't get mode,
you know, the city comes knocking, which is not not awesome.
Um, So we just we just take care of that stuff, right,
So it makes the roommate experience better, they stay longer, and then the
owner makes more on their investment. Right. Okay, so so what's the
average tendencies a tendency length, how long did they stay for? Now?
The average length of stay is sixteen months. It kind of varies based on
when they sign, but most people are signing for a twelve month lease.
It's a bit cheaper. You can do shorter, but it will charge more.
And so yeah, most people are usually doing a twelve month lease with
an extension, all right, And yeah, so is this mostly students student
housing or road does it crossover? Yeah, it's mostly not student housing.
Actually, we really house students most. The average age of people that live
with home room is twenty nine, so it's mostly a lot of people are
looking for more flexible to live, a more social way to live, and
a way to live that's cheaper. You know, for a tenant to live
in a home room, it's thirty to fifty percent cheaper than a studio apartment
in the same neighborhood. And so, you know, affordable housing is you
know challenge today. So homeroom is offering that in a way that's pretty streamlined
pretty professional, and you know it's hard to compete with especially on a price
basis. Okay, And so you were saying that the people eighteen to twenty
five, is that you're key demographic. Eighteen to thirty five really is the
key demographic, but it really exkews towards the mid to late twenties. So
in that generation and that demo is that is this what they expect They're going
to be sharing a house because it's so expensive, they can't afford to buy
in on their own. Maybe they don't want to live on their own.
How does it work? Yeah, you know, the percentage of people living
with roommates is actually more than doubled on a percentage basis over the last few
decades. Now twenty six percent of young adults are living with roommates. So
I don't know if if they necessarily expect it, but it is an option
that like most people in that age group have be no people that are living
with roommates today. Um, you know, it's hard to buy a house,
it's hard to save to buy a house. People have a lot of
student debt so and also people are waiting a lot longer to get married.
So there's just this big window of time where affordability is important and you don't
have two incomes. Right, Okay, so this kind of like transitional housing
if I have that right, correct, I guess. I mean I think
all of life is a transition, right, So I think, you know,
I think life stages come and go in all different directions, and so
this is sort of some people are transitioning out of marriages in the home room,
some people are transitioning in you know, out of college. You know,
it's it's all over the game, it's all over. We don't really
say this is for pre marriage, but we do find that there's a massive
demand in that group. Um and uh yeah, So something like that I
think could be said interesting. Interesting, And it's like it's it's really a
growing market. Huh yeah, it's been. It's been grown for the last
four decades, that's for sure. So I do it Does it turn around
at some point? Um, if housing becomes a more affordable Um, it's
hard to say. What's the biggest driving factor is I think how I think
it's a mix of housing, affordability, loneliness, and delayed marriages. I
think all those together kind of just you know, this the stars. You
know, standard apartment is fine, but it is very isolating, you know,
and it's very expensive and you have to you know, and it's very
constrictive in terms of what you can do with home, or you can kind
of in our app you hit a button, you can transfer to a different
location, transfer between cities. So you know, housing is not very it
doesn't feel very modern, even in like nice newer apartment building. So there's
also a portion of this that is the experience of living doesn't have to feel
so nineteen eighties in my and so that's that's something that we're also really focused
on and why would people really enjoy what we offer? Hey, all right,
so we want to find out more. If we own property, we
want to engage the service. How do you find How do you find it?
Um Uh, We're at live homeroom dot com. You can kind of
you know, we have few options. If you're a tenant, you can
hit us up. We have some virtual tours at homes. If you're an
investor, you can schedule a time with our investments team and they'll kind of
talk you through how it all works. And if you ever have questions about
roommate living, you can email me at Johnny at livehomeroom dot com. I
like to chat about it. It's kind of my it's a big hobby of
mine. And also so yeah, that's how you get a hold of us.
Okay, Well, the link will be in the show notes live homeroom
dot com. And if you have any questions for Johnny and myself, shoot
us an email k l at Kerry Lutz dot com. We'll get you an
answer quick. It sounds like a very valuable service. We didn't even talk
about the roommate screening and judgment searches and evictions and criminal record it searches all
part of the platform and John and good luck with the service and appreciate you
coming on. Karrie, thanks so much for having me. Had a great
time and really nice, nice chatting with you, and and to our audience,
thanks for listening to Carrie Lets's Financial Survival Network, your solution to today's
trying times. For the latest, go to Financial Survival Network dot com.
Financial Survival Network now more than ever,