Renting out a home by the room is a great way to earn some extra income. It has become a popular strategy for real estate investors primarily because it pays better than renting out to a single family or individual. However, this strategy can backfire based on your choice of tenants. Here are some common issues that tend to arise with these arrangements.
With more tenants under the same room, the potential for a headache increases due to emotions and tensions rising sometimes over the littlest things. You, as the landlord, will receive a multitude of calls from your tenants about broken items, confrontations, and other issues. While the extra money can be an asset to your finances, it won’t come without a few problems here and there.
Because renting out a room is a temporary arrangement, you’ll inevitably have to put up with a high tenant turnover rate. After a few months, your tenants will want a space of their own and most likely move out. Other times your tenants just won’t feel comfortable sleeping in the same house with other strangers which might be a cause for them to move also. Be prepared to replace your tenants every three to six months.
Before implementing this potentially lucrative strategy, be prepared for the inevitable problems that will occur. It’s all about the minimization of damages when it comes to renting. Also, you should note that there are additional expenses that you need to know so you don’t get blindsided by fees.