Tuesday, April 22, 2014

Disadvatages of renting out rooms

An alternative to renting out an entire house or apartment, landlords sometimes rent out a room inorder to charge a higher total rent. Despite the higher profits, there are several disadvantages that they may face. 

When renting out rooms, you may encounter more vacancies and longer vacancy periods.

Responsibilities

When renting out a house by the room to individual renters, it can be difficult to delegate responsibilities. In a regular rental setup with only one renter for the entire property, the tenant usually takes care of all these. However, with rooms being rented out and a common area used by everyone, you may have to hire a housekeeper or cleaning service, which will eat away at your rental profits. 

Conflict

With many different people living under the same roof, conflicts and arguments between tenants may arise. These disputes may be difficult to settle. If you can’t settle these problems, your tenant may choose to discontinue the lease, leaving you with a vacant room. 

Vacancy

When renting out rooms, you may encounter more vacancies and longer vacancy periods. The market for room renters is usually charaterized by students or single employees. This makes for faster turnovers, since students might choose to stop renting once they graduate or go on vacation breaks, while employees might also opt to move to a different location once another job opportunity comes along. On the other hand, renting out the entire property to a family is a more viable rental setup.

Property management

Consider the time and effort involved in renting multiple rooms as opposed to renting out the entire house. As a landlord, you’ll be addressing the different concerns of the many residents in your property. It can be overwhelming and time consuming to be handle different tenants simultaneously.


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