House Hacking with Friends and Family

[Immanuel Pierre]

I recently bought my second house hack in October 2022. My roommates/tenants are my mother (recently divorced), my sister (over night nurse, who spends most days at her boyfriends), and a coworker I have known for years. Before buying the house everyone knew the terms and what the living situation was going to be. My friend just recently came back from Colombia (within a week of this post) and I did not charge him while he was away. Everyone knew this. Upon his return my mother and sister have both asks if rent would be the same amount because there was an extra person paying now. I thought this was a little odd to ask and was not sure how to go about it, so I told them that it was the same and I did not really expect to change it. Neither of their quality of life has changed, I volunteered to give up space to accommodate the additional person. So my two questions are, Was it a reasonable question for them to ask does the rent change when they knew he was eventually moving in? Should I lower the rent amount since there is an extra person now? 

Rent is $1100 each and the mortgage plus HOA comes out to $3300. I have been covering utilities.

[Laura Shinkle]

Living with family and them paying you rent can be a very tough situation. It's hard to walk that line of son/brother and landlord. 

1. Is the lease in writing? Having it in writing may signal them, in a way they haven't thought about it, that you're their landlord and that this is legit, not just a random idea you came up with. It'll also show that there are guidelines for this relationship (landlord/tenant) so that the expectations are set up front. No one wants to pay rent, and tenants, regardless of being family or not will try to get any opportunity they can to lower and/or not pay rent. 

2. Since the situation was clear from the beginning (ie the 4 of you in the house), then I don't think you should lower the amount. There were expectations set up front, and nothing has changed other than you being nice and not charging rent while the 4th person was out of town. 

3. Rent isn't set by your expenses. Rent is set by the market rate for that room/living space. Just because the mortgage/HOA comes out to $3300/month doesn't mean that's what the rent needs to add up to. Do some research on roommate situations in your similar area to see if you're charging too much/not enough/just right.

4. Rent is rent, regardless of whether they're on vacation or not. Always have the same standards for all tenants. If you give a little to one, everyone will have their hands out.