Anyone ever owned or run a "halfway" house?

[EasyMoney_in_NC]

Not sure what the economic climate has factored in to my difficulty in renting my current vacant homes, so I thought I'd try something new.

Long story short. A home I built years ago as a small package of 3 (2 I kept) is still owned by the woman I sold it to. She and I have come back into passing contact within the last year or more. It so happens that she works for and is fairly high up in rank in a recovery/treatment center for drug and alcohol abuse. Quite some time ago, we discussed me building new properties for the specific use as the halfway homes for people coming out of treatment. The revenue potential sounded great but we couldn't come up with a suitable location.

She recently called me (when the house next to her came available) asking if I would be willing to use the home next to her as one of these such homes. Its a small 4 bedroom, 2 bath home with a garage which could lend itself beautifully to trying this..............so that's what I'm going to try.

She has the ability to provide the manager (who lives for free) and the "residents" on an ongoing basis. She's agree'd to do it for little to no pay for 90 days until we see if it works ( and then 10% +/- of monthly gross). Within a week of speaking to her (having told her I wanted to furnish the home for a grand or LESS if we were to do this), she has apparently secured the manager ( a middle aged man clean for 17 months) and has taken it upon herself to start buying furnishings etc for the place ( for which I agree'd to cover her purchases once complete).

The monthly money (assuming she does her job and keeps the place "stocked" with residents almost doubles my monthly revenue for that property. The program, she tells me, is very strict and with her next door should remain in good shape (she'll be my eyes and ears). I have expressed my wishes not to be involved in any way shape or form to which she has agree'd.

I'm actually excited to see if this will work, could be a whole new way to ride out a crappy economy (in regards to renting in the conventional sense). My intentions is to keep the head count low (only 4-6 people total per house - most tend to have many more) and build a good reputation for being a nice place and worth the wait, try to get a waiting list going. Plus if I keep the count low, it won't throw up red flags to neighbors and I'll fly below any regulatory radar.

Curious if anyone has tried this before. I'm a bit nervous about turning over complete control over to someone (I tend to be a control freak) like this, but it sounds really good and the property is vacant anyway, so why not try it?

 

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[reipro]

We have done it before in here. We did not have to furnish the unit, they (the company did). The rent was great they paid there payment every month on time and they had there own maintance guy as they ran about 40 units here, but the unit was trashed when we got it back four years later. Major damage to subflooring, holes in walls, burns on counter tops. You name we had it. Still over all no vacancy for 4 years I would do it again.

 

[hatterasguy]

My uncle is very good friends with a lady who makes about $3m a year doing just this. In CT you have to go through some red tape to get on the list and into this program, also you kind of need someone to walk you through it. He is getting into it, and in another year or so he should have a few houses with these tenants. Naturaly I would like to buy in as well.

He will be renting to people trying to get clean, and mentaly challanged people who are supported by the state.

I don't understand the whole thing, but the way it works in CT is you charge the people very little rent, and the state makes up the difference. Than you charge the state a lot for services. Say you have someone do a class, you charge the state $100 a head and pay the instructer $25, etc. His friend makes her money on services.

Its a hard business, but the profit is very high. Also since the state is paying the economy doesn't matter as much.

 

[EasyMoney_in_NC]

Well we have an in treatment type housing scenario here as well that requires whoops to be gone through as well. What I'll be doing is an after treatment (outside the state control) housing. Its explained to me as the tenants "half way" to complete sobriety. Most homes have multiple people sharing each bedroom with a central "manager" who is the den keeper if you will. They control the house rules, meetings and basically manage the place. I'm only going to have 1 person per room (trying to make a good impression and get a good reputation for a nice place to live, as apposed to being a money grabbing whore with a heard of people in his houses).
My contact works for the treatment center they have just been discharged from and helps to place them for after treatment housing. Its a revolving door, but she will handle that end, I should just collect the funds from her (in simple terms).
There's a guy here in town that apparently no one can stand, that has a good lock on this type of housing so I think she is hoping to give him a little run for his money through mine. Either way, with minimum residents, I go from the 900's a month to 1500+ a month for little effort (I hope ). I have made it clear I want no part of the daily grind and I don't want my name out there as a participant. I know a lot of people in town and want to keep arms length, to which she has agree'd.

Its worth a shot. She's furnishing it too for me (on my 1k dime of course), so I don't even have to deal with the early stages either. I'm interested to see how this goes. I'm told it can be really good money, maybe a little harder on the property, but if it works, could be well worth the extra wear and tear............time will tell

 

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[^eagle^]

I lived in what might be considered a "three quarter way" house.

there was no manager. we were a democratically run house. It ran much like a fraternity does.

Here's the website
Oxford House

The houses are normally in upper middleclass neighborhoods. There are times when these houses fail. Not many people welcome alcoholics recovering or otherwise.

The houses are usually well taken care of by the residents. However sometimes vacancies do occur and can put a financial burden on the house.

If you have any questions feel free to PM me.

 

[EasyMoney_in_NC]

PM sent, thanks for your input