Multiple unrelated singles in duplex

6 Replies

I inherited tenants when I bought a duplex last Oct. One unit has three unrelated singles who share the rent equally, pay with one check and are all three on the lease. All was well until recently when one decided to move out. He found a replacement and thought that was it. Long story short, I did a background check on the new person and all worked out. A month later, another one of the tenants wants to move out and doesn’t have a replacement. I explained that the lease is a legal contract and they can’t just come and go as they please (which I’ve learned the prior landlord did allow). The lease is up end of Nov and I wonder if I should just get them out so I don’t have to deal with this going forward. But, a) Dec isn’t a great month to find a new tenant, right? b) How do I avoid multiple single roommate situation going forward? The duplex is very large and has 2 to 4 bedrooms depending on how you use the rooms. I can’t say max 2 people per bedroom since that could potentially be 8 people! I’m wondering if limited the parking to two cars would be the best route. Suggestions are welcome.

Hi, many cities have occupancy restrictions, such as no more than 3 unrelated parties in any unit, regardless of room count, so check with the city first.

Your issue is common, kids! They have their friends, but friendship may wear thin living together or they can come up with new boy/girl friends, etc. etc. etc. 

Put all tenants on the lease, responsible jointly and severally if they are first time renters or college age, get moms and dads to guarantee the lease, because they won't have rental histories and probably not sufficient credit.

You might ask if they would all like to move in July or August! That's up to you. I'd cut them lose as soon as possible and start out with "my" tenants. 

Remember too, you can't define family status or require people be married or single. The family is who they claim to be "family". Good luck :)

If all parties agree, you can change lease terms mid-term. But it has to be by mutual agreement. The make up households can change over time for various reasons. Establish a plan for handling that and you won't be caught off guard. We prefer month-to-month agreements because they give us more flexibility and it is easy to rent-up any season in our locale. Landlords in cold weather states usually set lease agreements to expire in Spring or Summer when the weather is more favorable. I'm surprised the current lease on your property is set to expire November 30, 2015... if it is in New Hampshire.

Be aware; when setting occupancy standards, fair housing laws come into play. HUD recommends 2 per bedroom plus 1. However limiting to 2 per bedroom is generally seen as reasonable and acceptable. Any less than that and you could easily run afoul of Fair Housing laws. If the bedrooms are extra large or extra small that could make a difference. Also, take into consideration the number of bathrooms as that factor can weigh in as well. Parking, not so much, unless there are additional requirements specific to your jurisdiction about parking.

Some jurisdictions have local laws that restrict household make-up by number and by relationship. Check that out for your area.

For us, we don't mind roommate situations that change (or adult children moving in and out of their parents' home) or other changes in household make up. We adjust the rental agreement to accommodate this. We will release tenants and/or add tenants, by starting with a new rental agreement or by adding an addendum. However, each change comes with a price to compensate us for our time and expenses. We must approve each new tenant prior to their moving in. We do not expect tenants to find a replacement for the one vacating. We only require that, as a household, they still meet our minimum criteria to rent, including sufficient household income.  

Also, we don't refund security deposits, in part or in full, until we regain possession of the unit after all parties have vacated. We may however request an additional security deposit if we accept a new tenant who poses more risk. It is up to the roommates to sort out how they want to deal with their individual shares regarding the security deposit. For us, it's easy.... rent is paid by one check and the security deposit is returned by one check at the end of tenancy.

If they are otherwise good tenants and abide by the terms of the rental agreement, you can choose to accept it for what it is and be flexible. As a young adult, I lived in a house share situation and it was a great experience. The landlord loved us and he enjoyed long stretches of time with no vacancy. You will ultimately need to decide what works for you.

@Renee R. In these situations, I make all adult tenants sign the lease. Further, the lease says that all tenants on the lease are jointly and severally liable for meeting all terms of the lease agreement.

Joint and Several Liability means that each person who signs the Rental Agreement agrees to be liable for his or her individual share of liability and, in addition, agrees to be liable for the liability of all other persons who sign the Rental Agreement. This pertains to rental payments and damages, among other terms. 

This helps to cover you in the event of one person moving out, and it creates a lot of peer pressure for one tenant to not walk out on the others.

We own rental homes in a college town, where many of our homes are rented by multiple singles, and not all students. We have only had small issues related to this, and I think the lease terms and choosing good tenants have a lot to do with it.

Room occupancy goes by ages and gender, a square footage minimum for each occupant of a bedroom, if it's big enough, you could have 3 brothers or sisters at certain ages. Infants can be with siblings or parents. I had 5 in a large  3 bdr, read your codes carefully, here related parties were counted as one, so 2 of the 5 were not related for a total of 3. 

You can find occupancy requirements on the HUD website, average ceiling heights to determine Sq. Ft. of an area, ages and gender of minors, if you accept Sec 8, see your local administrator as to unrelated parties, that can become rent skimming of public funds. :)

Thanks All. This is helpful. This gives me some ideas for things I can do. I do want to work with them; they're 20 somethings, work hard and pay on time. Good to know this happens with others and you've got things in place to handle this situation.

Marcia, it sounds like you've been handling your tenants similar to the history of my tenants. Can you tell me more about this: However, each change comes with a price to compensate us for our time and expenses. What do you charge each time you need to re-do the lease?

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here