How to divide the rent among roommates?

Question

I have 2 bedroom/2.5 bathroom rental property. Two brothers were living in the house so far but one brother has moved out so that room is open to rent. The current tenant is in the master bedroom with private full bath. The available second bedroom is smaller in size (80% of the master bedroom) and there will be personal full bathroom assigned to whoever stays in that room but it is outside the room. Apart from these differences, the roommates will share everything equally. It is 1088 sq. ft property with an additional 600 sq. ft space of the unfinished basement and I am going to set the total rental price at $1250 for 1 yr lease.

Here are my questions:

1. How should I divide the rent if one person comes to live in the available bedroom?

2. How should I divide the rent if two people come to live in the smaller bedroom while the current tenant lives alone in the bigger bedroom?

Any suggestions will be appreciated. Thank you.

Here are my questions:

1. How should I divide the rent if one person comes to live in the available bedroom?

2. How should I divide the rent if two people come to live in the smaller bedroom while the current tenant lives alone in the bigger bedroom?

Any suggestions will be appreciated. Thank you.

Marc Winter · Answer

Respectfully, I see it as a recipe for disaster.  My thoughts--it's tough enough dealing with tenants; when you have to deal with housemates, you become a landlord, a mediator, and a detective.

Why not just let the original renter (the one in the master bedroom) sign the lease for $1,200 and let HIM get a house mate and let THEM deal with the issues of "who ate my yogurt?"  Or complaints of "the guy in the other bedroom snores and it keeps me up" or the music is too loud, or "if he's late on the rent it's not MY problem".

You get the idea.  I advise you to simplify, not complicate.

Allan Smith · Answer

if you are renting by the room, there is no full rent for whole house. Doesnt matter. Charge the most you can get and still get qualified tenant. Maybe put in listing that its 75 extra if they bring a second person. Usually room rentals include utilities.

If you find a group of people that want to rent the rooms, go with an auction. Really it's their problem but nonetheless. Say its 650 each room. Anyone in their right mind would pay 655 for the master. Then someone else would pay 660. And so on until one of them says heck they'll take the small room for 620 etc

Alissa Engel · Answer

@Dhaval Sheth

I think you are taking WAY too much responsibility for the tenant and HIS situation.  HE needs to solve HIS problem.  He’s got you chasing your tail when it’s not your job to figure out how HE can afford to stay in the house.  Get the monkey off your back and back on his (where it belongs).  Give him another month to find a roommate (that meets your criteria) or he needs to leave. IMO roommate situations are the worst (soooo much drama and chaos).  Try to rent the house to one person/family/couple.

Ned J. · Answer

You rent by the room...... the one with the attached bathroom slightly higher.

You don't rent by the person......you rent by the room/house....so if 2 people stay in one room, its their problem on how they want to split the cost....you expect ONE payment for that room...PERIOD. Let them figure out the details.....not your problem.

When you start having separate payments from multiple roommates you are setting yourself up for conflicts.....one will pay and the other doesn't.....one moves out and the other stays...... deposits get messy. Its drama that isn't worth it.

The only exception may be if you are covering all the utilities....3 vs 2 people in the house will typically have a higher avg utility bill, so you need to account for that expense.

Unless you want to get caught up in a bunch of conflicts and drama, don't try to manage a bunch of individual people....you manage it by the room or by the house.

David Mussaw · Answer

I have only one rental property which I rent to one family. My comment may be naive due to my small amount of experience in being a landlord. You're set on the $1,250 per month for rent, have you spoke with the brother who stayed and offered him to rent the whole house for $1,250 with the option to sublease the extra bedroom and bathroom. Let your current tenant determine the value of the other bed and bathroom, and manage the other tenant for you.

Ned J. · Answer

DO NOT let one tenant decide who stays/rent the other room. YOU need to screen and approve of ALL tenants that stay in YOUR property. They are welcome to find someone, but they still have to be screened and approved by YOU.

By letting one tenant decide who rents the other room, you are turning over landlord responsibilities for YOUR investment....not theirs. Its your $$ and you are the one that will have to deal with evictions, damages etc etc if they pick a poor tenant....don't do it.......

Let them find someone but they still have to be approved by you...no exceptions

Rick Imby · Answer

If rents have changed since the first time you rented then rent the vacant room at what is currently the going rate.  That may be 700, 650 or 600.  If you are renting by the room they are separate transactions.  In lots of apts the identical apts have different rents.  While there is only one tenant in the apt is he paying all the utilities?

Theresa Harris · Answer

@Dhaval Sheth As it is a 2 bedroom house, I'd rent it to two single people with each getting use of one room.  If there is an IT company nearby and lots of single employees, it shouldn't be hard to find one person to rent the room.

Dhaval Sheth · Answer

@Ned J. No. I meant to say that he asked me to find a roommate for him to share an apartment and he will be happy to sign one-year lease after that. And I gave him a choice to bring a referral such as his friend or colleague that I will screen before allowing him to stay in the apartment. Sorry for the confusion.

Will C. · Answer

@Dhaval Sheth

Sounds like your intention is not to rent by the room but full term lease then it should be the responsibility of the remaining brother to either pay the full amount of rent, find his own roommate or move. Sounds like a receipe for disaster. Either the random person you pick will create drama or the brother with get tired or footing the full rent and leave.

How to divide the rent among roommates?

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