Hey everyone, I'm curious to hear if anyone has any suggestions for the rent by the room strategy and what systems they implement when managing a RBTR.
What is the best way to set up your leases?
How do you have your tenants pay?
What software/system have you noticed works best for the rent by the room strategy?
How would you/do you screen your tenants for RBTR so that you don't put the wrong people together?
Lastly, any other recommendations or advice for rent by the room Landlords would be appreciated!
Rent by the room is a great strategy assuming you approach it in the correct way. I've found that this seems to work best for students. Now most people are turned off by renting to students, but with the correct systems I believe it can be successful.
I don't know which market you are in, but if you are near a major college or university that is something that helps quite a bit. With the student renters you need to put them all on separate leases and have a parents or financially responsible adult also co-sign on the lease. This way if there is damage to the property you can work with the parents on that.
Second, you need to clearly spell out how the utilities will be split between the renters, what happens if someone doesn't pay their share, how the fridge and pantry will be split, etc. This needs to be very clear upfront and communicated throughout, otherwise missed rent/electric payments could become a habit (having a co-signer helps with this too).
Also, graduate or medical students are usually a little easier to manage than undergraduate students. So I would take that into consideration as well. Apartments.com has a decent free property management program that I use on my rental for screening, background checks and marketing. We collect rent via Venmo as it is simple but as you scale this will obviously not work. The program you use I feel is less important as you will find the software over time that you like and works best for you.
Hopefully this helps!!