South Jersey Real Estate Investors Association

The Impact of Student Debt on Qualifying Tenants

As an investor and housing provider, one of the things I fear most is a long-term vacancy. I’m
about to face the worst vacancy of my life… all three of my children will finally be out of the
home, with two of them heading out over the next few weeks in pursuit of educational
advancement. In today’s world, that advancement is usually accompanied by something else
we are becoming all too familiar with in the United States, student debt. My children will leave
school in 3 years with around $50,000 in student debt, which has become easier than ever to
access. Never before have I seen such willing lenders who are anxious to provide funding to
someone who statistically is less than likely to make the lender whole. As an industry, this
overfunding of student loans, and the high volume of defaults, will begin to affect how you and I
manage into the future.

Starting at the end of June, student debt will no longer be paused as a side effect of Covid, and
payments will again be called due. Over one-third of all Americans between the age of 18 and
30 have some type of student loan. Thirty percent of those loans were already delinquent
before the Covid pause. As a housing provider you are going to see the impact of this over the
next several months and years and need to be educated and ready to make the best decision
possible.

Having been a private investigator and housing provider my entire adult life, I have seen the
ebbs and flows ... Read More…

Your Short-Term Rentals Can Generate 6x Gains 

by David Pickron

Rarely in life can the quick version of anything ever compete with the more time intensive “real deal.”  Think of any instant food and you will quickly realize that I’m telling the truth.  The same had held true for real estate investments for at least the last century… but times, they are a changin’.  As you look at your portfolio it may be time to consider transitioning some of your long-term holdings into short-term rentals, and here is why; short-term rentals can generate up to six times the amount of revenue as a long-term hold.  My average long-term hold properties cash flow at around $200 per month; my short-term rentals cash flow just over $1200 per month. Does that get your attention? 

As you consider transitioning from long-term to short-term rentals, you should examine the following factors to help ensure that the changeover is successful: location, needs, and saturation. 

LOCATION

The old mantra of location, location, location in relation to real estate has endured because it is true.  For short-term rentals, it may even be more important.  A friend of mine recently converted their 5,000 square foot custom home in a regular residential neighborhood in Phoenix, AZ  into a short-term rental.  In his mind, he had already cashed the checks after he listed the home on the popular short-term rental sites. But there wa ... Read More…