Planning to rent out a MIL unit and need some guidance

[Corey R.]

Hi all,

We just purchased a home with a MIL unit (located downstairs) in the daylight basement.  There is a main living area above ground (where my wife, son and I will be living).  The MIL has its own separate entrance, however, there is a laundry room located in the MIL as well.  We are planning to utilize the laundry room as a shared laundry.  Luckily the laundry room is in the corner and we are building a wall with a shared hall to the laundry room where both living spaces will be able to access the laundry room.  We will have our own entrance (with lock on door) and the MIL will have it's own separate entrance (with lock on door as well) joined by a hallway connecting both living spaces to the laundry room.  Utilities are all on one meter so we will be including electric, water, cable and internet in the monthly rent.  

Any tips on renting a MIL unit when you are the primary home owner living in the house?  We are located in unincorporated King County (Seattle address, but just outside the city limits) so we aren't strapped by the City of Seattle landlord/tenant laws.  I'm wondering if there are different rental laws for MIL units or is it the same as all rentals?  Is it recommended to do a regular lease agreement?

Thanks,

Corey

[Jim D.]

I have lived in/rented a house with the exact setup you described. MIL's are awesome! 

The rental rules will just all be local, so you'll want to call the city and see. But everywhere I've lived allows you to rent this out as a separate unit as long as the owner (you) also lives in the home. All the standard rental rules should apply. Just use a standard lease.

Also check your local laws on this, but where I lived, the rules stated that if you were renting out part of your personal residence, you are allowed to discriminate based on family status and other things that normally are protected classes. (However, certain things like race are always protected classes.) This only mattered to me because I learned that having families with toddlers living in the unit above me was not pleasant, so after that I always chose single renters. Check and see what the rules are in your area.

Enjoy paying hardly any mortgage payment!