The Basics of Starting a Shared Housing Business
Shared Housing is an incredible business model that helps entrepreneurs solve one of the greatest problems in America, housing insecurity. Providing housing for marginalized groups while being paid by governments grants and programs is a win-win for everyone.
Do you want to help other people and make huge returns on your rental properties in the process?
We’ve discovered the solution to doing well and doing good, and the Shared Housing Academy is sharing that secret with entrepreneurs and real estate investors nationwide.
Entrepreneurs must first determine the type of group home they plan to operate. There are several types of group homes:
- Veterans’ homes
- Residential assisted living
- Corporate housing
- Student housing
- Foster homes
- Recovery homes
- Transition from prison
- Golden girls and boys
- Special needs/autism
- Temporary workers
Shared housing can involve a shared journey of any kind that includes short term rentals. This style of group homes can serve unrelated individuals who meet certain stipulations.
As a result, owners are able to help a chosen entity of the population and do well financially.
Why do shared housing investments do so much better that traditional residential rentals?
This article will explore the basics of starting a group home, and how the financial benefits far exceed renting to single family tenants.
HOW TO OPEN A GROUP HOME
Group homes serve unrelated individuals; these homes are single-family units. Individuals residing in group homes usually receive some level of personal, mental, emotional, or medical care while living in the facility.
Some group home residents receive medical care, others undergo psychiatric therapy and personal care assistance.
Even with personal and professional resources available, group home residents have a level of autonomy.
These guidelines are important, because group homeowners have a responsibility to adhere to licensing requirements, inspections, and an application process.
HOW TO EASILY MEET THE REQUIREMENTS
Requirements for group homes vary from state to state – the stipulations are typically very different, especially depending on the group you plan to serve.
Elderly care and assisted living homes have completely different requirements. It’s important to consider your state guidelines and restrictions for aging and disabilities.
For example, group homes that house individuals dealing with autism and down syndrome have a unique set of care requirements issued by the state department of developmental services.
Proper licensing requirements are not difficult to attain
ESTABLISH A BUSINESS ENTITY
Prior to starting a group home, be sure to register your business entity with the secretary of state.
Each state provides website access for business registration.
In addition to state registration, secure a federal employer identification number from the IRS. As a result, entrepreneurs are able to apply for a license and establish legitimate business entities.
These steps will allow you to secure a commercial insurance policy to protect yourself from your business’ general liabilities and workers’ compensation.
It’s never too early to start the process of putting the logistics of your business in place.
DESIGN AN EFFECTIVE BUSINESS PLAN AND OPERATIONAL MANUAL
An effective business plan defines the market and explains how your group home will attract and sustain residents.
Your business plan will be necessary when completing your application process.
You will be required to complete a narrative explaining a clear plan for serving residents, enriching lives, and keeping occupants safe.
You plan should include:
Afterward, you will need to develop a budget that reflects income and expense projections. Your 5–7-year financial projection will enable you to sustain your business long-term.
The operations manual should be included as an addendum to your business plan. Include the following in your operations manual:
- Resident intake processes
- Daily schedules
- Administrative guidelines
- Safety, first aid and emergency procedures
- Medication storage and distribution methods
The operations manual should describe the daily processes of the business.
THE APPLICATION PROCESS
After establishing the business entity, completing the business plan, and operational manual, start the application process.
Your application process will require background checks, fingerprinting and drug screening. This process will be necessary for you and your staff.
Prepare to complete education background, experience, and related credentials. This process will also prompt on-site inspections for health and safety requirements.
Additional documents may be required based on state guidelines, be prepared to respond quickly.
AVAILABLE RESOURCES AND GRANTS
The federal government provides funding for some facilities that provide shelter for individuals who meet certain criteria.
Some grants provide funding to help develop residents in areas of technology and employee training.
The Community Facilities Grant Program is administered through the Department of Agriculture (USDA).
The program gives money to facilities that are available for public use in rural areas.
The amount of the grant depends on the population and the median household income of the area in which the grant will be applied.
There are a variety of different of grants available through various state and federal government agencies for different populations ranging from:
- Battered Women
- Childcare and Development Fund
- Community Facilities and Learning Centers