Renters in your own house... separate areas?

Question

Let's say you buy a single family as an owner-occupant, with the goal of having a couple renters to defray the monthly bills. But let's say the town does not easily allow conversion from singles to multis anymore. Can you install a kitchen and bathroom in the renters' part of the house, and even have a separate locked entrance to their area, perhaps just the whole upstairs for example?
Can you even have in the lease or "house rules agreement" that they cannot come into your part of the house? Or do i not have the power to designate which area a "housemate tenant" can and can not go?

Rob K. · Answer

Back in my real estate agent days, I sold a house that had three tenants renting rooms. It was an old colonial in a trendy part of town. My seller was in her 70's and lived on the main floor. He son had built a small wall and door so that when you walked in the front door, you could walk upstairs to the tenants are or walk through the new door #2 to the owner's main floor. He son had turned the dining room into a bedroom for her. She had a living room, kitchen, bathroom, bedroom, and basement. The upstairs had three bedrooms (each with their own lock), a shared bathroom, and a small fridge and microwave in the hall that they could share. She was on a small fixed income and having these renters really helped out. They had no access to her part of the house.

My friend's brother used to live in a house that had been chopped up into a rooming house. The tenants each had a bedroom and shared a kitchen and a disgusting bathroom. He had his own fridge in the kitchen, but had a padlock on it. I remember thinking that if I ever found myself in a situation where I had to padlock my fridge and wear shoes in the shower, I would declare that I hit "rock bottom" and go out and get at least two more jobs.

Jon Holdman · Answer

Can you do it?  Sure.  I've seen numerous examples of this in some of my farm areas.  One are in particular.  If the county records show it as a 2/1 ranch with basement, its almost guaranteed to actually be a 4/2 with two separate kitchens.  Often with a separate entrance that goes directly into the basement unit.  Sometimes just blocked off from the upstairs unit with a door, sometimes a wall.

Is it legal?  Probably not.  Unlikely any of this work was done with permits.  You have a house burn down and kill a tenant due to unpermitted work and rest assured you'll be spending a lot of time in a courtroom.

Now, can you rent rooms and then put certain areas off limits?  Almost certainly.  Doesn't mean they will honor your requests, so good locks would be in order.  Many areas around here have a "no more than two unrelated parties" limit in low density residential areas.  If its you and two roommates, its unlikely to be a problem.  Three or four, all with their own cars, and you might have a problem.  Parking is usually the issue in this regard.  And its your neighbors that will turn you in if you disturb them.

I have seen posts where someone tried to evict someone from an illegal duplex.  They were allowed to proceed with the eviction but were not allowed to collect any back rent or damages from the tenant.

Mehran K. · Answer

I rent out two spare rooms in my primary residence.

There are "common areas" and "non-common areas." In my house rules addendum, I just stated that the garage and the shed in the backyard are "NOT COMMON AREAS." Pretty simple right?  :)

In your case, just state in the house rules that your floor is not a common area. Just make sure they sign and date the house rules addendum along with the rental agreement prior to moving in. If you catch them on your floor you can say bye bye if you want. As far as kitchen and living room are concerned, I think if you're not comfortable with sharing those areas with boarders/roommates then you shouldn't have them.

I highly suggest using a Month-to-Month agreement for roommates. No way would I use a 1 year lease!

Jon K. · Answer

This.

You're talking home renovation without permits here. That in my area = fines.

Plus, you're taking in a boarding when your house isn't zoned for it. What it sounds like you need is a "roommate" and just separate stuff. You can say "no kitchen" or no whatever, but obviously that may or may not keep them out.

You could just put a mini fridge and microwave in their space and not give them "kitchen privileges." It's only the honor system keeping them out of your space. I have seen a few people do this, but it comes with risk, and little recourse if something goes wrong and you're already violating city ordinances. You could, I suppose, try to rent to a few students or someone like that who only needs a short-term place to stay and put a mini-fridge and microwave in their room. Your roommate rules would say no kitchen access, and you would hope they paid on time and hope for the best.

A couple of renters? Check your area. Some areas limit how many unrelated people can live in the same house. That could mean zoning issues, liability, home insurance not covering it, little recourse if they don't pay since they're living in a boarding house that's already violating city ordinances, etc. Even if you say "tenant only has access to upper floor" in your lease, how would you enforce it in city court if you're violating city zoning rules and have renovated the bath/kitchen without permits? That sounds risky. No, I'm not a lawyer.

Make sure your home insurance even covers boarding house situations such as this.

Why not just buy a duplex? You live in one side, and rent the other side out to a tenant. Both spaces are completely separate, and ideally already a multifam.

Matt Devincenzo · Answer

I think to Mike Franco's reasoning, you can state what ever you want in the lease, but since it is an illegal conversion that you knowingly did to circumvent the laws, then it is also not a binding legal agreement. Also you'd have an illegal kitchen, since I doubt the city would issue the permit for a second kitchen without an explanation so now you're open to code violations ect.

You can ask a RE attorney to be sure, but I think you'll find you don't have a leg to stand on if anything happens.

Matt Liu · Answer

But if I really wanted to have "boarders" and give them their own kitchen/bathroom, separate entrances, etc. can I legally restrict them from using my floor of the house? Would it be via a "house rules" agreement or can I just say in the lease what area they have access to.

Jon Holdman · Answer

I'd buy a cheaper house or rent rather than live with "boarders", as they used to be called.

Mike Franco · Answer

You'll have to see if you can get away with illegal conversions.

One of my relatives did that and it wasn't pretty when the bad tenants used it as leverage to not pay rent.

Renters in your own house... separate areas?

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