Ashley:
On today’s rookie reply, we’re tackling three more thoughtful questions straight from the community, covering some really creative and challenging situations.
Tony:
First up, we’ll talk about a property manager exploring a unique way to earn income by tying their pay to appreciation instead of rent. Then we’ll help a rookie investor figure out how to buy their next property despite a high debt to income ratio. And finally, we’ll give some tips to a couple with kids who want to rent out a room in their home to medical students.
Ashley:
Welcome to the Real Estate Rookie podcast. I, I’m Ashley Kehr,
Tony:
And I am Tony j Robinson. And with that, let’s get into today’s first question. Alright, our first question up comes from Jeff and Jeff says, I’m a Superhost on Airbnb for my own property, and I’m considering starting to offer management to other people. But rather than taking a cut of the revenue which can make the cashflow challenging for the owner and markets with decent forecasted appreciation numbers, I’m playing around with the idea of taking a percentage of any future appreciation. Has anyone come across that business model any way to do this where I can see myself with X percent of $0 unless there’s no appreciation? Would this be an attractive option for you as a property manager as opposed to a percent of revenue? This is interesting. I’ve literally never heard anyone frame this question as a property manager to say like, Hey, I don’t need cashflow. I just want a piece of the appreciation. Have you ever heard anyone structure a management deal like this? Ash?
Ashley:
Actually, I think that I have as, I don’t think that I would do this, but I’m pretty sure that I have talked to people that instead of wanting part of the cashflow, they want part of the equity in the property and it’s a way to get them started in real estate investing. You see this in business models where someone goes and works for a company and they…