Real Estate Agent · Chicago, IL · Member since 2021 · 27 posts · 39 votes
Hello everyone!
I am a real estate agent that currently has a a client looking into buying a Fraternity house as an investment and I wanted to know some of the important things one should consider before going that route. The biggest concern of course is the liability that’s attached with a Frat house. We all know that the connotation of a Frat house is things could potentially be broken and the crazy parties and such. So in what ways would the investor be able to protect himself from such liabilities? If things are damaged or destroyed, is it automatically on the owner financially or would they put something in the contract that if something is damaged or destroyed, it would be tacked on to the Frat houses dues(essentially the owner getting their money back for whatever damages he/she had to pay for)?
Investor · Austin, TX · Member since 2018 · 119 posts · 114 votes
5y
I've never owned a frat house but I think it would be a great idea to write something into the rent agreement that shifts the cost of repairs onto the tenants. From a legal perspective, you also might want to consider having the tenant sign something that waives their right to sue the landlord if they get hurt from something in the house (for example, their parents can't sue the landlord if their kid drunkenly decides to dive head first into a door). Depending on where it is there may be protections against this though, I'd reach out to a lawyer or property manager in your area for more specific info.