Real Estate WEALTH Magazine | Page 76

Single-Family Home Rentals are Dead? Discover the #1 Investment Opportunity FOR THE NEXT 20 YEARS A re single-family home (SFH) rentals dead? Well, that depends on who you are renting them to of course. How does $200-$300 a month in positive cash flow sound? When I was 20 years old, that was exciting. Today, that doesn’t get me very excited at all. Lets face it, one turn over with even one month of vacancy eats up an entire year’s worth of profits in most cases. Let me show you how to get TWICE the fair market rent with a long-term, low-impact tenant or if you’d rather, how you can make $10,000 or more NET per month with Residential Assisted Living. The Baby Boomers are here and they are driving the demographics in housing for the next 20 years. Nearly eighty million of us were born between 1946-1964. We are the Baby Boomers, and we are turning 65 at the rate of over 10,000 a day. Life expectancy is increasing and many of us will live well into our 80s and 90s. There are 4,000 a day turning 85 and 70% of those people will need help for an average of 3.5 years. The 85+ year old group is the fastest-growing demographic of all in the U.S. It is projected to triple over the next 20 years. Senior housing is a great place to be now and will only be getting better and better for the next 20-30 years. The reality is that most seniors will not need a nursing home but they can’t live safely on their own either. They do need assistance and that is what is provided with Residential Assisted Living or RAL. Many of you have already faced this situation with your own parents. If not, well, your time is coming. This mega-trend will last for several de- cades to come and you can profit from this unstoppable wave and help a lot of people by “Doing Good and Doing Well”. Senior Assisted Living is the Best Real Estate Investment Opportunity for the Next 20 Years. This mega trend is a “Silver Tsunami”and it has created a massive opportunity for smart investors who are poised to profit. Let me explain why “typical” SFH rentals are dead. If you rent a home to a typical tenant, you will get a typical profit of a few hundred dollars a month, maybe. With a typical turnover and a month of vacancy in between you may end up with little or no profit at all at the end of the year. Now, if you were to get TWICE the fair market rent, your profit increases exponentially. Instead of a few hundred dollars in profit you would be netting a few THOUSAND dollars in profit each month. With your typical tenant you have a one-year lease. They may stay for a second or even a third year but they are looking to buy their own home and move out in most cases. That’s not bad but, on the other hand, what if they move out after a few months in the middle of the night and leave you with thousands of dollars of repairs from the damage they left behind? Been there, done that. Let me ask a By Gene Guarino, CFP silly question: Would you rather have a long-term, low-impact tenant? A tenant that wants a five-year lease and wants to have two or three, fiveyear renewals on top of that? That is what an operator of a RAL wants. That is why senior housing is the best real estate investment opportunity for the next twenty years. Long-term, low-impact tenants who are willing to pay twice the fair market rent. Why would someone pay TWICE the fair market rent and how do I find them! The answer is your tenant, the operator of the RAL, will still be able to make a lot of money even after paying you twice the FMR.