81–90 of 154 posts
I love anything that creates more housing in the bay, but these are 30-year contracts! I can't even imagine getting into a 30 year contract with a company that might not exist in 30 months. What happens when the start-up goes under, or gets acquired, etc? Is the loan made directly to a third party bank?
Earlier quoted context omitted.
The contract then binds the acquirer. The more problematic aspect is committing them to buy out the rental on sale of their house.
Hi there - my name is Spencer and I'm one of the co-founders of Rent the Backyard. It's worth noting that this is actually something the article wasn't great on. If your buyer is excited about continuing this agreement, we're happy to sign the unit over and even take a second position to a new mortgage so you don't ever need to pay anything. The great thing about a backyard apartment is that it is a permanent improve…
People who can afford their home will not like watching their property values and quality of life decline because a neighbor “rented” its back yard. Taking the Uber approach - ignoring laws - won’t work here, so this business is entirely at the mercy of permit laws. I find it astounding that some ideas get prominent backing. Furthermore, home owners will discover that having people travel alongside their homes to rea…
Hi there - my name is Spencer and I'm one of the co-founders of Rent the Backyard. We're very much focused not taking the Uber approach. We're working within the context of a set of laws California has passed over the last several years that establish and regulate what the state calls "accessory dwelling units" aka ADU. We're initially focused on building in cities like San Jose that have factored the sustainable and…
The California market might be suitable for this, but that market is unique in many ways. I wonder how this can scale beyond CA (perhaps that market is big enough...).
Given the alternatives to unaffordable housing, I see the appeal. But as other commenters have noted, this need exists because of a very warped localized economic situation. The real problem may not be solved, but eventually there will be some shake out (such as vast numbers of people deciding it's not worth living there) that will help to normalize things. When that day comes, your business model will be less relevant.
Cheers and good luck.
I think people would be better off borrowing the money and building their own. Where I live (not in US) you might spend say $100k or more building one of these, but without necessarily adding capital value to your house, so you'd break even on your first $100k of rent, after tax. So even building your own may not make sense. The many reason for building on is as a 'granny annex' or a place for your parents to live so you can help them out. Or a place for your kids to live when they move out.
I don't have a backyard, and nobody I know in my area that also makes six figures+ a year has one, either. This trend has been documented [0]. Granted, my cohort is all earlier in our careers. But with years of saving, much of it prioritized in 401k's, IRAs, and HSAs, I don't have enough left for a down payment on a single family residence. [0]: https://www.washingtonpost.com/business/2019/02/21/are-you-c...
A couple of things to consider for the homeowner, increases in property taxes and insurance but also the taxable revenue from the rental and its impact on personal taxes you will have to pay. And then there is resale value for a property that is locked into multi year agreement.
>increases in property taxes Not an issue in the bay area >the taxable revenue from the rental and its impact on personal taxes Progressive income taxation should make this moot. Also many expenses are likely tax-deductible. Combined with FHA terms, mortgage interest deduction, etc. and this is actually rather tax-advantaged over regular rentals
Why not?
Prop 13 protects the homeowners from higher taxes if the property appreciates, but as far as I know that doesn’t cover renovations.
Otherwise you could buy a beat up $1M, year it down and still pay the same taxes.
Hi everyone, my name is Spencer and I’m one of the co-founders of Rent the Backyard. Rent the Backyard was founded to help homeowners who want to earn extra income from their underused backyards but don’t want to spend a ton of time or money to make it happen. Rent the Backyard provides a turnkey solution — we handle all the logistics of putting a studio apartment in your backyard — helping you earn $10-$20k per year…
Earlier quoted context omitted.
this. anything that restricts or impedes what you can do with a home is a liability, not an asset. Up in SF, even partially tenant-occupied homes typically sell for a sizable discount. (also doubt that ~10k/year is going to make waves in the target market -- Bay Area homeowners with a back yard big enough to make this viable.)
It could be very meaningful to older retired or semi-retired folks who have fully paid for their home and are looking for additional income but don't want to sell their house and leave their neighborhood. AirBnB used folks in that situation here in Vancouver to great effect when pushing for support for short term rentals in the local market.
>builds studio apartments in homeowners’ backyards, which are then rented out That might be one of the most dystopian things I've ever seen on HN.
Hi there -- this is Brian from Rent the Backyard. What we are doing here is finding a synergy between homeowners and renters, allowing for people to profit off their unused backyards while increasing the housing stock. Airbnb started the trend of being able to monetize your home in the form of rental income and we see ourselves as an extension of that phenomenon. In our case, homeowners give up zero privacy to make m…
>Rent the Backyard will give the homeowner an increasing share of equity in the apartment, until they own it completely after 30 years
What's the life expectancy of these backyard studio apartments? Somewhere around, oh, thirty years?
>Homeowners also can buy out the startup’s equity and take full ownership at any time (which they’ll need to do if they sell their home and move out).
I'm assuming there's some legal way to transfer the entire contract to another person, so you could sell your house and property along with your stake in the a-yard-ment and the new owner takes over where you left off. Having a renter will lessen the likelihood of having to sell for financial reasons but a good chunk of home sales are prompted by owner becoming unable to keep up the house or live alone in general, due to age or illness.
How's the agreement work with other stuff like use of the yard itself and other stuff that might be concerning like loud music, changes to the fencing setup, planting of flowers the renter is allergic to, etc? Not just for the homeowner, but for the renter. I can imagine many of the owners, having had to put very little work into this, really not giving a crap about their renter or her/his needs.
>What we are doing here is finding a synergy
C'mon man. Your picture doesn't feature nearly enough 80s power tie for you to talk like that.
I don't like the idea of taking a free and simple house, which you can sell, and myring it in a contract with another company (no less a startup!) so that when I want to sell, I need to explain the agreement I have with this other party to annex the land. I reckon it would devalue the house. I think people would be better off borrowing the money and building their own. Where I live (not in US) you might spend say $10…