The Side Hustle Show Episode 721

$1k a Month with your First Co-Living Property

Host: Nick Loper
Guest: Sam Weger, Scale Your Co-Living Real Estate Podcast
Release Date: February 5, 2026

Episode Overview

This episode explores how co-living can be a highly profitable and impactful real estate side hustle. Guest Sam Weger shares his journey from simple house hacking to owning and passively managing over 200 co-living rooms while addressing the affordable housing crisis. Sam digs into the nuts and bolts of the business, legal hurdles, juicy horror stories, and actionable how-tos for getting started—even with low capital.

Key Discussion Points & Insights

1. What Is Co-Living and Its Financial Potential?

• Co-living involves buying a large house and renting out rooms individually, often converting living spaces into extra bedrooms.
• Traditional advice: cash flow of $100–250/month per unit. Co-living commonly produces $1,000–2,000/month per house.
  • Sam Weger: “We won’t even look at a co-living home unless it produces $1,000 a month in cash flow. I would say the average is closer to two grand.” (01:17)
  • Some students report $5,000/month from a single, large house.

2. Finding and Converting the Right Property

• Focus on square footage, not just bedroom count.
  • Rule of thumb: 1,500 sq ft = 4 bedrooms; add a bedroom for every additional 250 sq ft.
  • Convert dining rooms, basements, etc., into bedrooms.
  • Sam: “The biggest thing you need to look for in a home is square footage because you’re looking for size...1500 equals 4. And then every 250 square feet that that house gets, that means I find an extra room…” (02:50)

3. Legal Hurdles & Workarounds

• Zoning and occupancy rules often limit number of unrelated people under one roof.
• Creative solution: structure tenants as a “club” membership rather than standard leases, modeled after similar tactics used by large co-living companies.
  • Sam: “We create an agreement that is not a lease agreement. We form a club...the club has hundreds and hundreds of members. The private club rents the house and the members get to use the house.” (05:25)
• Laws are evolving; e.g., Colorado now prevents cities from restricting unrelated adults cohabiting.

4. Best Locations and Market Factors

• Evaluate “co-living friendly score” (local attitudes, enforcement risk) and affordability gap.
  • Avoid anti-co-living cities (Nashville, Sarasota are strict).
  • Focus on cities where studio apartments are out of reach for those earning $15–25/hr, but not so cheap that co-living holds no value (e.g., small towns with $400 apartments won’t work).
  • Sam: “You’re looking for a city where a studio apartment plus utilities is out of reach for people who make between $15–$25 an hour after taxes.” (09:39)

5. Acquisition & Financing Strategies

• Most start with a primary residence loan, as low as 3% down, then house-hack; after a year, repeat for next property.
  • Alternative: buy with intention to move out after one year, then convert to full co-living.
  • Creative tactic—“invoice authorization”—have the seller fund rehab at closing by negotiating a higher price, but have rehab costs paid out of proceeds.
  • Sam: “We get the seller to pay for the rehab, and we’re successful in probably 95% of the cases in doing that, even on the larger rehabs.” (13:47)

6. Ideal Property Checklist (16:58–19:58)

• No HOA: Avoids restrictive rules and legal headaches.
• Neighborhood fit: Prefer B-/B-quality, working-class areas with relaxed parking, no “white picket fence” uniformity.
• Large square footage: 2,000–2,500+ sq ft optimal.
• No amenities/pools: Stick to essentials for affordability, easier maintenance.
• Proximity to major employers: Within commuting distance of large workplaces (airports, warehouses).
• Parking: Need ~2/3 as many spots as bedrooms. Bonus for walkable public transport.

7. Pricing, Tenant Types, and Room Setup

• Charge each room at 70–80% of local studio rent.
• Accept singles, recently opened up to a limited number of couples (prefer private bath and extra parking).
• Common areas are furnished; bedrooms left empty for tenant personalization.
• Staging and clean, attractive common areas critical for marketing.

8. Screening and Managing Tenants

• Use in-person interviews, background and eviction checks, income verification (2–3x rent).
• Label kitchen shelves/fridge space per room. Strict no-personal-items-in-commons policy.
• Regular professional cleaning; personal left items boxed and trashed if not claimed.

9. Community & Challenges

• Some homes develop strong community; others are more introverted/quiet.
• Memorable story: Sam married two former tenants who met in his co-living home. (29:13)
• Issues happen (“peanut butter theft,” personality conflicts, parking headaches, utilities, even bitcoin mining), solved with detailed house rules, cameras, and policies.
  • Sam: “We give everybody one free transfer. If it’s a really big issue, we’ll just be like, cool, we’ll transfer (to) another house completely free.” (36:45)

10. Scalability & Management

• As you grow, can hand off to co-living management companies (15–20% of rent roll); niche is now supported by specialist firms.
• Important to have robust systems, especially above six bedrooms.
  • Sam: “If you’re going to do a 10-bedroom home and you’re not going to live there, there’s some systems you need to have in place.” (40:12)
• Guest’s company only manages for students currently, but notes growing market of co-living property managers.

11. The Mission: Making an Impact

• Addresses the US affordable housing shortage (7.3 million units short).
• Offers cheaper living options and positive communal/social effects; can help combat social isolation and address the affordable housing crisis.
  • Sam: “The room will become the new apartment...If you become a co-living investor, you’re providing a housing option for people that is cheaper than the cheapest thing. So, therefore, you are an inventor of cheaper price points.” (24:12; 43:59)

12. Sam’s Final Advice

• Get clear, commit to one path, and go “all-in”—then put blinders on to avoid shiny object syndrome.
  • Sam: “I think at some point you need to lock yourself in a room for as long as it takes and just say, which one am I gonna go all in on?” (46:41)

Memorable Quotes & Moments

• On cash flow (01:17):

  "We won’t even look at a co-living home unless it produces $1,000 a month in cash flow. I would say the average is closer to two grand."
  — Sam Weger

• On property hacking formula (02:50):

  “The biggest thing you need to look for in a home is square footage because you’re looking for size...1500 equals 4. And then every 250 square feet that that house gets, that means I find an extra room…”
  — Sam Weger

• On legal workarounds (05:25):

  “We create an agreement that is not a lease agreement. We form a club...the club has hundreds and hundreds of members. The private club rents the house and the members get to use the house.”
  — Sam Weger

• Mission-driven perspective (43:59):

  “If you become a co-living investor, you’re providing a housing option for people that is cheaper than the cheapest thing. So, therefore, you are an inventor of cheaper price points.”
  — Sam Weger

• On commitment and focus (46:41):

  “At some point you need to lock yourself in a room… and just say, which one am I gonna go all in on?...choose and then blinders.”
  — Sam Weger

Timestamps for Key Segments

• 01:17 — Co-living cash flow potential
• 02:50 — How to assess and convert properties for co-living
• 05:25 — Legal strategies to operate in restrictive zoning areas
• 09:39 — Market selection & target tenant demographic
• 13:47 — Seller-funded rehab strategies
• 16:58 — Property selection checklist
• 21:03 — Renting to couples, singles, and special populations
• 24:12 — Preparation, marketing, and staging homes
• 33:18 — Tenant horror stories & house rules
• 40:12 — Managing at scale, property management options
• 43:59 — Social mission & affordable housing impact
• 46:41 — Final advice: pick a lane and stay focused

Action Steps & Resources

1. Learn More & Free Training:

   • Check out Sam’s website: scaleyourrealestate.com
   • Free 5-day co-living challenge for hands-on guidance.

2. Listen/Connect:

   • Scale Your Co-living Real Estate podcast.
   • Other Side Hustle Show real estate playlists: land investing, Airbnb co-hosting, rental arbitrage, house hacking, etc.

This episode is an essential listen if you're seeking a real estate side hustle that combines solid cash flow, scalable potential, and genuine social impact. Sam’s practical tips, personal journey, and transparency around both the rewards and headaches of co-living make for a comprehensive blueprint for action.