Roommates As Tenants

Prospective Tenants: 'The three of us have been best of friends since high school and would like to rent your house." Experienced Landlord: "Would you like to remain friends?"

What do you do? You have a rental property in a college town. A group of students want to rent your place together to reduce their individual housing costs. It makes sense, but what is the down side? And, what should they know before a rental agreement is signed? How can you, the landlord, help make this a win-win opportunity? How can you, the tenant, avoid destroying precious friendships?

The following is not intended to be a conclusive list, but is simply presented to help both tenant and landlord realize some of the things that may be involved when considering a rental where roommates are involved.

 

What Should A Tenant Know Before Renting With Roommates?

  • Limits of Friendship: Having been friends for years does not guarantee that you can survive living together in the same house month after month.
  • Personality Differences: Be aware of the personality differences of each person. Living together often causes certain traits to polarize. For example, a person who likes things to be neat may become a neat 'nazi' after living under the same roof with a friend who is comfortable with clutter.
  • Your Lifestyles: As far as possible, figure out ahead of time what kind of home and location will best serve your lifestyles.  For instance, if you love to party late and loud, rent a country house. If you need a quiet neighborhood, don't try to rent a place close to 'party central'.
  • Security Deposit: If a roommate leaves before the end of the lease, how will their portion of the security deposit be returned to them - provided everything they were responsible for has been kept in order? Most landlords will not return a portion of the security deposit. They will hold on to the whole amount until the lease term ends.
  • Legal Responsibilities: If a roommate causes damages, deals drugs, steals from another roommate, is unable to pay their agreed upon share of the bills, or simply abandons the house, what can/can't you do? What are your legal alternatives when your roommate refuses to abide by the rental agreement?
  • Joint Liability: Will all roommates be named on the lease? Do you understand what 'joint liability' means?
  • Subletting: Can you sublet the property? If so, what is required? If not, and you need to leave before the end of the lease, what are your legal options?
  • Your Needs: If the property is part of an HOA, what are their rules over and above the landlords requirements? Do they 'fit' the various needs of all of you?
  • Parking: How many vehicles will you all have? How many parking spaces are available? What if you need more parking spaces?
  • Health and Safety: Though the monthly rent may be attractive, how safe is the area? How secure is the property? How clean is the building? If you haven't rented before, learn what kind of things you should be looking for before you sign.
  • Pets: are they allowed? If so, how many? What kinds of pets? What 'size'?
  • Property Rules: Make sure that all your roommates read and understand all the requirements of the lease and any and all HOA rules. How many roommates are allowed? How long may a guest(s) stay over? What is required if there must be a change of roommate(s)?
  • House Rules: Decide among yourselves, beforehand, the rules of your home. Determine when noise/lights will be turned off. Will guests be allowed overnight? If and when there is a party, what are the expectations? Is smoking permitted? What temperature will the thermostat be set at? What is the laundry schedule? Who has what space for food items in the cupboards and refrigerator? If food will be shared, what are the rules? What are your joint expectations regarding modesty, drinking, and use of profanity? Who controls the remote control to the TV?
  • Conflict Management: How will conflicts be resolved? How may a roommate bring up an issue that concerns them?
  • Chores:  Who will do what, when, how, and to what level of expectation? What will be your house rules re: cleaning dishes, sweeping floors in common areas, taking out the trash, shoveling snow off the walkways/driveway during the winter, food storage in the cupboards and refrigerator,
  • Medical Needs: Do any of your roommates disabled, have special medical/psychological needs?
  • The 'Heavy': Will one of you be the 'go to person', the one who makes sure that all the agreed upon rules are kept, collects the money from each person each month making sure that the bills are paid on time, and serves as the liaison with the landlord or property management company?

The above list is rather instructive for what the tenant may need to consider.

What Should a Landlord Know About Roommates As Tenants?

  • Subletting: It is often best not to permit subletting, yet if you do, be sure to be specific on the details.
  • Joint Liability: Require that all roommates be held jointly responsible for keeping all terms of the lease. Make it clear that if one breaks any part of the lease agreement, all will be held legally responsible. Have all roommates sign the lease agreement. Inform each roommate that they, as an individual, are held responsible for the full rent. For example, regardless of how they may have decided to divvy up the rent among themselves, if all other roommates refuse to pay their share and/or abandon the property, 'their' agreed upon amounts do not protect the remaining roommate from paying the full rent.
  • Background Check Each Person: Save yourself a lot of potential grief by doing a credit and criminal background check on each roommate.
  • New Roommates: When a new roommate is added to replace one that has left, do a background check and then rewrite a new lease representing the changes. Again, have each roommate sign the lease.
  • Visitor vs Roommate: Does your rental agreement spell out the difference?
  • Tenant Liaison: It will be less confusing to communicate and deal with just one of the roommates.
  • One Check: Require the roommates to work out collecting what is due from each other and then sending in one check to cover the full rental amount. Don't get involved in chasing down two or more people for their rent portions. It is their responsibility to collect and pay on time and all are jointly liable if they fail to do so.
  • Property Visits: Make it clear when and why you will visit your property. Driving by periodically is also a good idea. Talking to neighbors periodically and/or the HOA representative to learn about any issues with your tenants may help you nip a potential problem in the bud.
  • Security Deposit: However the roommates came up with the required security deposit is their business. When a roommate leaves, any portion of the security deposit they may want returned is not the landlord's responsibility.  Each roommate should be informed that the security deposit will be held as a whole until the lease term is over - regardless of who moves in or out of the property. It will be returned to the tenant liaison at that time. It will be his/her responsibility to distribute the appropriate portions it to each roommate.
  • Educate: There is a certain romanticism and naivete in renting a place with friends. Unfortunately that can lead to unnecessary problems for the landlord as well as for the roommates. An ounce of prevention is worth a pound of cure. Create a roommate agreement that thoroughly covers the pro's and con's of renting a property with other people. Also, spell out for the roommates what your expectations are for maintaining and cleaning the property, as well as how to make a repair request if and when it is necessary.