Congratulations on investing in real estate! A savvy move for the organized, prepared, and patient investor!

I know your smart and you’ve done your research. You have reviewed any Property Owner Association documents for any restrictions or guidelines that you must abide by, and now you’re ready to get some tenants in there and make some money! What’s that you say? You also know how much the average rental amount is for rentals in the neighborhood? That’s great! But is that rental amount per home or per room?

In some cases, renting out rooms versus the entire home may be more lucrative. There are some pros and cons to consider, but with a little bit of planning, you may find that you might prefer to offer room by room renting.

Pros:

• Lower rent amounts give you a broader range of qualified applicants.
• In most states, room by room renting gives you greater control over who can rent a room — i.e., women only, etc.
• If one room tenant fails to pay their rent, you may still get paid from the others. Some rent is better than no rent!
• You can charge different amounts for different room sizes or amenities.
• Individual room rental amounts may add up to more than what you could get renting the entire home to a single tenant.

Cons:

• More tenants, means more paperwork and organization.
• You’ll have to find a way split utility payments among the tenants, although your tenants can manage this.
• Individual tenants may mean more neglect to prepare for in common areas such as the kitchen or laundry area.

So weigh your options, and think about your own pros and cons to room by room renting. Good luck!

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