Allowing Tenants to Have Roommates

Posted by Teresa on June 9, 2009 under Landlord Tips, Tenant Screening & Background Checks | Be the First to Comment

A landlord we know received this note from a tenant:

“Dear Ms. Landlord,
In part because of the current economy, I am having difficulty making ends meet. I’d like to be able to afford to take care of myself and my son properly, and one way I’ve considered is to take on a roommate.

I realize my lease is in my name only and currently you allow only my son and me to live here. Since we have an extra bedroom, would you have any problem with my bringing a housemate into our home?”

What would you do? Covering a few basics with your tenant can make this an easier process. While it is solely up to you as a landlord to allow your tenants to have roommates or not, it can lead to better retention and happier tenants—definitely a win-win situation!

1. Let your tenant know that it’s not as easy as just adding another person to an existing lease. It is a better idea to start with a new lease application under both names to minimize your risk. Your tenant may be relieved to understand that he or she is not responsible for the roommate, who has their own legal obligations once they sign the new lease.

2. You should consider raising the rent. Your tenant may not be prepared for this, but explaining that an additional person means more wear and tear on your property makes an increase in rent completely reasonable.

3. Are utilities included in the current rent? If so, you’ll definitely need to adjust the rent for additional usage, or consider changing the terms of the new lease to bill them separately. This could also be the time to have your tenants initiate service themselves.

4. Screening potential roommates. If you regularly prescreen all applicants, your current tenant should be expecting that any roommate will need to undergo credit, rental, and job history screening. If you have not been in the habit of screening tenants, you are completely within your rights to start doing so under a new lease agreement—and you should!

5. You probably are already aware, but if you’re not sure about your local occupancy laws, check them out. Some localities prohibit more than a certain number of unrelated adults to share a dwelling.

6. Be clear about who pays the rent. Some landlords accept multiple checks; others do not. It is certainly easier to deal with one check, and to avoid the hassle that could occur if one roommate pays promptly and the other does not.

While adding a roommate to a tenant’s unit can create a stack of new paperwork, it can also add to your profitability—and relieve your tenant’s money woes. Helping your tenants stick around is ultimately in your favor!