5 Tips for Handling Co-Tenancy Rentals
Many people choose to rent a home with a roommate or romantic partner. Learn 5 tips for handling co-tenancy rentals and the unique issues that come with them.
The number of households renting their home has increased to 36.6%. As more people choose to rent a home with a roommate or partner, co-tenancy rentals are becoming more popular as well. As a homeowner or investor, you'll want to prepare yourself for any co-tenancy issues that could pop up.
Here are five tips for handling co-tenancy rentals.
With these tips, you can avoid many of the common co-tenant issues. Instead, you can make sure everyone lives together without putting your rental income at risk.
Protect yourself and your property with these five tips.
1. Make Roommates Liable
First, take a look at your lease agreement. Make sure it states that co-tenants are jointly liable. In other words, the tenants within one unit are treated as a unit.
If one roommate violates the lease, the other roommates on that lease are held responsible as well. Meanwhile, if one tenant pays late or damages the property, all roommates are held accountable.
Adding this measure to your co-tenancy agreement will protect the landlord and help ensure damages are paid for.
2. Don't Allow Subleasing
Anyone who's considered a sublessor isn't jointly and severally liable for the lease obligations, including rent. If they didn't sign the lease, they aren't held accountable for damages, either.
In order to avoid co-tenancy issues, make sure everyone living in the rental unit signs the lease. That way, they're held responsible for meeting all terms of the lease agreement. Make sure to state that subleasing isn't allowed in the written agreement.
3. Name Every Tenant in the Lease
If the original lessors move out, the original tenancy is terminated. Once a new tenant is screened and approved, all tenants within the unit will need to sign a new lease agreement. While this might sound like more work, it keeps all tenants jointly liable.
It helps with record-keeping, too. This way, you won't have to worry about multiple agreements and addendums.
The median rent nationwide is now $1,445. By updating the lease agreement, you can make sure each tenant is held liable for paying the rent. Updating the lease agreement also gives you an opportunity to raise the rent or change the lease in any way.
Don't forget to perform a tenant reference check, too!
4. Suggest a Co-Tenancy Agreement
When roommates decide to become co-tenants, they establish a few basic expectations. It sometimes helps to suggest drafting a written agreement for these co-tenant rentals.
A co-tenancy agreement can cover:
- Which expenses are shared and how they're divided
- Room assignments
- Cleaning and chores
- Overnight guests
- Obligations at move-out
- How the rent is divided and who writes the check
Getting these details in writing can help landlords avoid future issues.
5. Insist on One Check
In order to continue treating all tenants as one person, make sure to insist on one check for the full rental amount. This will help you avoid individual tenant financial issues in the future. If one tenant can't pay their part of the rent, it's their responsibility to talk to the other tenants (not you).
Rent It Right: 5 Tips for Handling Co-Tenancy Rentals
Renting out your property doesn't have to feel stressful. With these five tips for handling co-tenancy rentals, you can keep it easy!
Need help managing your rental property? Contact us today to get the most out of your rental home!