I received a 30 day notice from my property manager stating that my current tenants will be moving out at the end of the month. They went on further to let me know that the current renter referred a set of people who want to be roommates in my rental home. This home has never been considered a roommate friendly property. In the 10 years that I have owned it I have only rented to families.
I feel somewhat uncomfortable with the fact of multiple people being responsible for the rent with no true tie to each other. Should I be concerned about default on ability to pay rent in a timely manner or follow through arguments?
Any and all comments are appreciated.￼
You can still rent to a group of people under one lease, you would just need to amend it if they had someone move out and had a new roommate move it.
I have had several tenants which were roommates and just knew each other through work or school.
An upside to it in the current economic conditions is that multiple tenants may have 3-4 sources of revenue streams in a house where a family may be limited to one or two incomes.
It’s much easier for 4 people to pay $500 per month than for one or two people to pay $2,000 per month.
Renting individual rooms out is an option but it requires more management and can be a huge headache.
Good luck, hope you can make something work out!
@Shannon Frazier If you can continue renting it to a single family that'd be the route to take
@Brandon P. That’s is a good way to look at it. I’d have to discuss the amendment of the lease with my property manager.
Thank you so much for the insight
@Shannon Frazier I don't think renting to roommates will be an issue at all. My only suggestions would be to see that they are signing a single lease, where they are joint and severally liable - that way all roommates are equally responsible and liable, for all the lease terms. I would also suggest that your property manager collect one single check for their rent each month and that their security deposits are not split up.
@Shannon Frazier roommates generally stay a shorter time period than a family. All it takes is one wanting to leave and they are all left either finding a new roommate or moving. There is also more interpersonal issues. Friends are great until you live with them.
Just be careful of fair housing implications, especially if some of the roommates are related. In some local jurisdictions occupancy standards may even prevent you from renting to over a certain number of unrelated adults. For example in my city, it is limited to 3 unrelated adults, but our policy is no more than 2 unrelated adults.
@Sharlene Mulchandani , thank you for your recommendation, that would be a good way of mitigating potential “deserters” from the room mates and loss of rent payments
@Joe Splitrock , interesting. I was not aware a clause like this existed. I will most definitely delve into the laws for NC to see what the guidelines and restrictions are for roommates. Thanks for the heads up.
todays bp youtube interiew talks of this, guy in atlanta..his llc is the 1 tenant, and he does weekly agreements with sublease .., furnished..this intrigues me but it doesnt sound passive and seems hard to find a property manager for this..double check my notes above with video....let mw know..if i can double my income on my single doors and keep passive , out of it, im in..