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Rent the Backyard (YC S19) wants to build a studio apartment in your yard

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Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#111

Post by sburl »

smt88 wrote: post #73
kspacewalk wrote: post #44

Earlier quoted context omitted.

You can stop leasing whenever you want to, buy the company that spent a five digit sum of money on that thing in your backyard will want to get then money back first, which is unsurprising.

That doesn't surprise me, but the way a bank would do it is this: 1) loan you the capital to build the structure, 2) create a payment schedule, 3) try to collect on that payment if you miss it. You could then declare bankruptcy if necessary, which means you'd keep the structure and have some sort of way out from under the debt. If Rent the Backyard has an ownership stake in the structure, it sounds like they could co…

People definitely use traditional home equity loans to build ADUs but this can be quite risky. There are more full-stack providers (like one of our building partners https://node.eco/ who's headquartered in Washington State) which make the process a bit less nerve-wracking, but it's still a lot of time, effort, and risk.

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#112

Post by sburl »

AnimalMuppet wrote: post #79
sburl wrote: post #60

Earlier quoted context omitted.

Hi there - my name is Spencer and I'm one of the co-founders of Rent the Backyard. You're totally right about possible zoning restrictions in most places. The climate in California has really changed in the last two years to allow what the state calls "accessory dwelling units" or ADU ( https://www.sfchronicle.com/bayarea/article/Are-accessory-dw... ). These laws cover everything from parking, to setbacks, to privacy…

Well, I think that the issue will be whether the dog works for the tenant . Hypothetical situation: I don't have a dog. I build one of these. A tenant signs a lease. Then I get a dog. But the tenant is terrified of dogs. But they've signed a lease, and (because nobody thought it would be an issue) there's nothing in the lease about whether the owner can have a dog. Now the tenant is really stuck - essentially they ar…

This is definitely something to think about as we get closer to renting these units. Our expectation is for tenant and homeowner to be fair and reasonable and we're developing a framework for what that looks like.

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#113

Post by anonseahorse43 »

iancmceachern wrote: post #85
JMTQp8lwXL wrote: post #17

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...

Same here, and if I were able to afford a downpayment I would live in daily fear of an earthquake because I wouldn't be able to afford Earthquake insurance, and if I did I wouldn't have the 20% deductible in the bank. I'm convinced that most non-wealthy bay area homeowners are essentially betting their financial future on there being no earthquakes here until the house is greater than 50% paid off. Tenuous is a fitti…

I think you're substantially correct that most people don't recognize the risk, but you've actually got the situation backwards:

The last thing you want to do in CA is own your house or have a mostly paid-off mortgage.

Earthquake insurance is crazy for all the reasons you mention (and more), but at the end of the day your non-recourse mortgage is your insurance: if your property is destroyed you can simply walk away.

Edit: I guess I should clarify that walking away from hundreds of thousands of dollars of "home equity" should hurt almost anyone. My point is simply that this protection is built into your mortgage, and is available on dramatically better terms than actual earthquake insurance, which in CA would likely be unable to pay out in the event of "the big one" anyway.

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#114

Post by C4stor »

sburl wrote: post #76

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…

What is the ecological value of the prefabs ?

I'm a bit concerned that we're still gonna build the same houses with no correct thermal isolation but big AC units, no electricity generation, no sonic isolation... and continue to house the poorest people in those houses which are also the most expensive to live in !

But maybe this is adressed in the week and half of construction, which would be a great feat !

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#116

Post by jmkd »

sburl wrote: post #76

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…

What's your approach to the loss of urban wildlife habitat (let's face it, bees) and the reduction in carbon sequestration potential (let's face it, trees) through the conversion of backyards into property development?

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#117

Post by anonymous5133 »

This has been happening lately in my area of Orange County, CA. There is an investor here who has been buying up single family residences with large backyards and then the investor puts these "granny flats" in the backyard to rent them out. The average buyer will simply see the property as a 3bed/2bath with a large backyard for 500k while an investor will see it as 3bed/2bath with a large backyard with opportunity for expansion....well worth more than 500k listed market value.

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#118

Post by anonymous5133 »

kevinyun wrote: post #102
gxespino wrote: post #90

Earlier quoted context omitted.

Who has time to manage a construction project? Just show me where to sign and send me my monthly checks.

Reminds me of this legendary comment: https://news.ycombinator.com/item?id=9224 Although I appreciate some of the argumentative counterpoints, most of the time it's from people who underestimate how lazy human beings are, and that people are willing to pay for simple services

Exactly. The biggest mistake people can make is to assume that just because you would do it a different way....that automatically means everyone else would do the same. Not the case.

Obvious example is pretty much everything on amazon is marked up 25% compared to the next biggest competitor (gotta love the "free" prime shipping, right?) but people pay up because amazon will get you your stuff in 1-2 days while Ebay will take 5 days or longer. People will pay for convenience and they will pay a lot for it as well.

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#119

Post by anonymous5133 »

m463 wrote: post #23
Mizza wrote: post #18

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?

I think of the long-term solar contracts that make it hard to sell a house.

100% agree. I was looking at buying a new home out here in Southern California. The new trend is "solar" on the homes....but the problem is that you don't own the solar when you buy the home. Instead you sign a contract with the solar panel owner and either buy the electricity from them or buy the panels outright....for an additional lump sum of 20k+. When you go to sell the home....you have to get the solar company involved and a bunch of other hassles. It is a bad idea to set it up like this.

Re: Rent the Backyard (YC S19) wants to build a studio apartment in your yard

#120

Post by timwaagh »

simonebrunozzi wrote: post #7
dpflan wrote: post #4

Can someone more familiar with the Bay Area housing issues and this company’s approach to increasing housing explain or analyze this for a non-Bay Area audience? I ask because this currently is Bay Area only.

I will try. In the US, there is the concept of Accessory Dwelling Unit - essentially, you can build a small shed in your backyard with a much simpler process, including the paperwork, permit, etc. If you are a homeowner, you can do that yourself - it means taking care of the permits, finding a construction company, etc, and putting money down, probably in the ballpark of 100-150k to do a good job. After this, you can…

if having someone rent the equivalent of a garden shed is all legal in the US, then they only need a few 'fools' willing to forgo 50% of rent to get rich.

It is really quite cheap to build a shed (a few thousand in materials and it's really not that hard. construction companies are not cheap, but since people build sheds themselves all the time you would not really need them.

in most non-US jurisdictions, this would not be legal. a father of a friend did this and the govt kindly requested him to force out his tenant.

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