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Updated over 6 years ago,
Do term variable rents make sense in house hacking?
Hello, some time ago I posted this question about house hacking a MF home. I have since decided to move forward on a SFR property, where I will be renting out the spare rooms. Wondering what your thoughts are on variable rate rents for this type of market. For example, 1yr: 650/mo, 6mo: 675/mo, month-to-month: 685/mo. Would this discourage tenants looking for a simple, low-cost one room rental?
Would it also make sense to only offer month-to-month after a tenant has signed a 1yr or 6mo lease? Or should it be made available up-front to all new/prospective tenants to attract more interest? My reasoning is that it is preferable to have a stable, long-term tenant. This avoids high turnover and lowers vacancy rate, decreasing cost to screen applicants, show the home, deal with phone calls, and everything that goes into the screening process. Perhaps that is not the right approach for this market? Are most people looking for stability in a roommate type of arrangement or for flexibility as they transition to an apartment or home of their own? Thank you!