Shared rentals

[Lotana]

I've got a lot of questions to ask about shared rentals since I've been dragged towards becoming a shared landlord

Firstly, the property has 2 bedrooms, each with its own bathroom, a lounge room, and a kitchen.

Secondly, prospective tenants inspected it and said that they would only be interested to rent 1 bedroom with bathroom and share the kitchen and the lounge room. That's fine, so I am now looking for tenants to take the other bedroom/bathroom combination.

There will be 2 separate RTA signed, they would share electricity and gas bills, each will have their own telephone connection.

Question 1. Whose name should be on the electricity and gas bills - the tenants’ or mine?

Question 2. If one of the tenants moves out and I'll find the new tenant, would the remaining tenant have a say?

Question 3. If a shared area is damaged - who should be held liable?

Question 4. Do I prepare a standard residential tenancy agreement or there is a different / amended form for shared properties?

I'm sure I'll have more questions, but that's it for now.

Looking forward to hearing from our experts and newbies alike. Perhaps even from people who lived in shared places.

Cheers,

Lotana

 

[geoffw]

I've never seen separate rental agreements in shared places- but it is a few years since I've shared. I guess things were a little easier then.

In that situation, I was happy to take the place under my name, and advertise for people to share. That way, I had more control, and I could charge a small premium. When I left, the tenants had to option of taking over the lease or moving on. And when I didn't get on, I had the right to kick out that person.

Separate rental agreements would take away any of those advantages.

 

[D.T.]

Why dont ya try to find a tennant who is willing to rent the whole thing, and have them "rent" the other half privately?

For example students might do this... rent it out to one for example at 250$ and they could advertise at their school for a share in a house at say 125-150.

In this case the first mentioned one will be liable, no?

Just my unexperienced 2c

 

[Peter Noake]

Multiple tenancy agreements are no problem for share houses. That is exactly how we have our 9 bedroom student house set up. The PM simply advertises Room X avaialble. The lease stipulates which room the tenant is leasing, and if applicable, whether they have access to parking spaces or sole access to bathrooms or other amenities.

Certainly doable, but of course you need to be sure that a multiple tenancy will actually work with your property.

Pete

 

[geoffw]

Peter,

That's interesting.

But a 9BR is somewhat different from a 2BR.

Who's responsible for damage to a common area? What about phones? Upkeep of garden?

And I assume that PM would be a higher percentage than normal.

For the original poster with a 2br hose, how much extra PM work might be required?

For a 2br, I'd be suggesting that the prospective tenant be offered a 1BR rent at maybe 70% of total rent of the total rent (or certainly somewhat above 50%)- as a carrot for managing the shares themselves.

If youmanaged, they will be paying even 60% of rent. If they managed,the person they get in should be paying more than 50%- perhaps 60%. So both the landlord and the tenant are better off.

 

[Kevmeister]

From a practical perspective, I like dtraeger's idea.

You finding two shared tenants could result in incompatibilities. A group of friends sharing, with one being the primary lessee, might reduce your future turnover of tenants.

 

[Lotana]

Kev,

I agree in general. But we don't live in an ideal world. If I advertise for the whole property I will miss a part of the market. Currently I have a foreign student applied for 1 b/r and will advertise in the share accommodation classifieds for the other bedroom. I am going to play a psychologist and try to predict any incompatibilities.

Cheers,

Lotana

 

[JustAMum]

I have a cousin, who finally took the plunge to property rental investment. They have a 5 bedroom place they are setting up for student accommodation. They have one room taken already, and expect the rest to go over the next month.

They say that when they were tenants in student accommodation that they didnt have condition reports. I'm recommending that they DO. I think there MAD if they don't do a standard condition report - signed by tenant and PM.

The're fine with the standard Tenancy Agreement and bond being sent to the bond authority (victoria)

Has anyone else out there had experience with student / shared rental property management? Do they complete complete condition reports? Am I just being a control freak?

And once again, what is the experience with shared areas? How do you get them to take responsibility - apart from verbally? And if verbally - what spin do you give for better results. My cousin isn't concerned about this aspect - they feel they have it under control - but I'd like to know.

JustAMum