Wonderful community! I have a question - I rent by room in the Charlotte area and up until this point, I have rented all my rooms through referral and my tenants bringing me qualified folks (I've been very lucky). I have a vacant room now and for the first time I have taken to the internet to advertise. I posted on Facebook, put my room for rent on Hotpads, posted on Craigslist, and I have gotten a lot of interest. However, no one is applying. I was wondering if anyone does the rent by room and how you vet tenants. It seems that the application process is pushing folks away. They either know they won't qualify or they don't want to go through the hassle.
I am interested in seeing the responses to this as I am debating between a SFH and a RBTR strategy for a house hack or looking for 1-4 unit MFs. The Charlotte market seems pretty tough for MFs right now.
If you don't mind me asking, what has been your RBTR experience thus far?
Hey @Jerry Mical , there is already a low inventory of MFs in Charlotte, making it difficult to find them. I have had a good experience thus far. I bought a home in 2017 and began renting out the whole house to a family while I moved to Miami (so I landlord from a distance). In 2018 I transitioned to the rent by room strategy. So the home has been through many phases! With my rent by room, it has been learning bit by bit as I go. I started off with the basics to cover me - everyone on their own lease, made sure I had the correct insurance, and went from there. In the last year, I have run into some issues that I will be addressing moving forward:
1) How to advertise to and vet potentially tenants (hence this post)
2) What to do with the security deposit for the common area with people leaving at different times
3) I will be getting a cleaner! Like most posts on this say, that is the biggest headache my tenants give me
You are able to screen tenants through rentprep.com. It's not the cheapest service I have found, but it's fast and easy to understand. There are two levels you can do; one that requires the tenant to put in their info, and one where it doesn't. The one where it doesn't does not give you as detailed info, but it definitely gives you what you need.
If folks are interested but not progressing, you are either too high for the area and they are finding better deals else where, or your criteria are too strict. I would consider looking at both. Also keep in mind this is a tough time to fill a rental. A lot of folks don't like to move in December.
Thank you for the input, @Sarah Brown ! I have tried rent prep. I don't think I have enough units to make it worth it just yet (I still have time to screen them on my own and such) but I will look into other deals and the criteria other landlords are asking for in the area! Thanks
I don’t think there is a minimum. It’s not a monthly fee. Just a pay as you use it sort of thing.
@Jasmine Calin There are a few property management companies that have tenant placement services have any consider those? I also have a cleaner I could recommend if you would like! The security deposit for the common area would be tricky and depends on how you have the agreement structured. Apartments.com, Craiglist, Facebook, and Zillow are a few good ones to start. What are your criteria? When I was an operations manager for an investment portfolio I had 2.5x rent for income credit over 640 with no evictions to start. Then checked employment and landlord references. Keeping it open with the communication and being quick always help with establishing my relationship with any tenants we placed.
Hey @Jasmine Calin , have you thought of short term renting? Airbnb might be a great way to rent that room and possibly increases your gross rental income if you currently only rent the room for the long term. Just an idea, hope it helps
@Brandon Despras Thanks for the response! I am wanting to do it myself so I can learn (so when I am ready to get a PM company, I have a sense of that the job entails). Currently my criteria is 3xs the monthly rent and 600+ credit score. I am in the market for a bi-monthly cleaner, please send that over!
@Robi Schreckhise , I landlord from afar (I live in Miami, property is in Charlotte) and have zero experience in short term renting. I hadn't thought of that probably because I didn't think it was an option. Within the year, I am going to convert the garage into a studio so I may need to consider that option! Thanks, that is an exciting new venture!
@Brandon Despras When you do the background check, are you charging an application fee for it?
I rent by room and use same process as a normal rental. I use Cozy to vet candidates and manage tenants. Vetting thru cozy is simple as the candidate pays $40 thru the website, personal info is protected, and I see results report.
I make it clear in the FB/ craigslist ad that I do background, credit, reference checks to ensure their safety/harmony along with the other roommates'... to help them see the value in spending the $40 to apply
Awesome, @Andrew Powers ! I hope your business is thriving. I will add that to my ads, great way to help them see the value in it. Do you let folks view the property before applying? I may have more questions for you later, thanks for chiming in!
I put an open house date in the ad. If someone is seriously interested they will make time to come, or they'll message to say they can't make it but want to see it on a different date.
Feel free to reach out anytime!
Originally posted by @Jasmine Calin :
@Robi Schreckhise, I landlord from afar (I live in Miami, property is in Charlotte) and have zero experience in short term renting. I hadn't thought of that probably because I didn't think it was an option. Within the year, I am going to convert the garage into a studio so I may need to consider that option! Thanks, that is an exciting new venture!
If you are interested, I work with a third party Airbnb staging company that can furnish the room for you and there is a 3rd party company that does nationwide property management for Airbnb's as well! There is always a solution, and I'm here to help in any way I can
Maybe you can market the room as a Month to month office rental space? I've thought about doing that here in the Denver market if I'm struggling with filling a bedroom. Depending on the market you may be able to do that. You could market the speed of the internet, the quietness of the house, the homey family room for work breaks, etc. You may even want to see if any of your current tenants would want to rent the extra room as an office space!
By the way - have you posted in various Facebook groups AND Facebook Marketplace? or just your personal page?
@Grace Wang I posted it on my business page and I believe on the Marketplace but I am going to check. As far as the office space idea, that is so smart. The garage I am in the process of converting is perfect for that.
Yes always charge an application fee. If they ever request a refund for the application you can always just send them the credit report (always works well with people who are upset because they didn't meet the criteria)
@Brandon Despras How do you collect the application fee?
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