Rent by the Room in San Diego

[Janell Johnson]

I have a nice 3 year old home in San Diego County (city of Oceanside next to Camp Pendleton) and I’m considering the rent by the room strategy as opposed to selling it before I move to Texas. The value of the home is 1 million and is ten minutes from the beach. It has 4 bedrooms (possible 5th). Any thoughts? 

[Dan H.]

I have never done rent by the room, but I have a lot or local LL experience.  I recognize rent by the room can result in increased rent.  

For our properties that have multiple unrelated tenants, we have the tenants act as a single tenant.  We get a single rent check.  Each tenant is individually responsible for the rent and any damage.  The reason our lease is setup in this manner is to reduce our effort and reduce our risk. 

There is a correlation between number of tenants and associated effort.  In addition, treating each tenant as a separate tenant results in increased move in/move outs, potential tenant conflicts that LL may have to referee/arbitrate, and tenants blaming each other for any damage. 

Basically, rent by room has higher rents but takes more effort and has more risk.  More effort from OOS is more difficult than more effort when things are local. 

Have you found a PM that is willing to manage your property with rent by room?

Good luck