Renting your rental property out room by room in Warner Robins can have big advantages, but it can come with some problems.
This can be a great option for houses near universities or in other more transient areas. Read more to find out how renting your house room by room can work for you.
Some professional landlords will choose to rent out their property room by room, often occupying a bedroom in the house themselves. This is great for those who are investing in a single-family house using an FHA loan requiring them to live onsite for a while after the purchase. Renting the house out room by room can be a lot of work. You have to have the right people living there for things to go right. When you do, things can be very profitable for you.
Your Rental House will have Less Vacancy
One vacancy is not a big deal for a landlord that has 10-20 other houses to help pay the bills. Renting one house by the room can do the same thing if you only have one or two houses. Your houses won’t likely ever be completely vacant which helps ensure you are pulling at least some income on a consistent basis. Your splitting your income by multiple tenants.
When you are renting out rooms, typically the landlord/owner will live onsite as well. If that is the case or if the landlord lives nearby, there is less chance of any major issues.
Renting by the Room can make More Money
Let’s say you have a 5 bedroom home. You live in one room and rent the others out for $500 apiece. You’re making $2k each month. However, if you were to rent the entire house out, you may not be able to get as much. It’s similar to when investors purchase a large tract of property then sell off the lots individually. When all is said and done, you may be able to make more money this way.
When renting by the room, the cost usually includes utilities, basic phone and an internet connection. This will bring your cost up. One solution is to look at average usage rates, then charge each tenant a flat fee. However, this can come back to haunt you if your tenants surpass average usage. At the end of the day, it’s your name on the accounts. Make sure your numbers for renting by the room are worth the extra work. Double D property Solutions can help analysis your situation.
Arguments Among Tenants
Most people that rent by the room are students or adults that are struggling with life. When you have multiple tenants in one property it is inevitable that tensions can arise. Be sure that your lease is specific as possible, so it can be used to mediate differences between your tenants. The rules should be laid out in black and white and everyone needs to respect each other’s space. We like to go over the lease with each tenant in detail to ensure everyone knows what is expected of them. If these rules aren’t being adhered to, you can read our blog about evictions.
Rent by Room City Zoning
Renting by the room can be considered a VRBO (vacation rental) by the city. Some locations will charge extra “hotel” taxes, especially if you charge by the week or sooner. Some cities don’t allow “vacation rentals” at all. In our area of Warner Robins and Perry, local hotel companies have pushed the city into passing this very law. Know the laws.
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