With split rent, a landlord should provide suggestions, disclose a few housing rules and help tenants choose the best arrangement. Here are six steps to help you split rent between multiple tenants:
- Establish a roommate agreement
- Split the rent equally
- Split the rent by income
- Split the rent by bedroom size and amenities
- Split the rent by bedroom square footage
- Use a split rent calculator
1. Establish a Roommate Agreement
A roommate agreement details the rules, responsibilities, and expectations every tenant must follow. Each roommate signs the document to legitimize the contract. As a landlord, you generally have no direct involvement in creating this document. However, encouraging your tenants to write one is beneficial for a more harmonious relationship between all parties. Here are some items you can suggest to your tenants to include in their agreement. Rules about:
- Borrowing other people’s personal belongings
- Sharing food
- Having guests over
- Deciding on what bills to share and pay for
- Cleaning and tidiness
- Deciding room assignments
- Dealing with noisiness
- Moving out of the rental
- Handling of security deposits
2. Split the Rent Equally
Equally splitting rent is the most straightforward approach for your tenants since everyone pays the same amount, regardless of their room size, income, etc. Because everyone’s payment is equal, this method is best for arrangements where all the rooms and amenities are similar. If those details are not crucial to the tenants, then this is the easiest way for them to split the rent.
3. Split the Rent by Income
Though uncommon, splitting rent by income is a more democratic approach because the price each tenant pays is more economical for their unique financial situation. In general, the high-income tenants pay a larger percentage of the rent, while low-income tenants may owe significantly less. If everyone agrees to the condition of the deal, this method helps lower-income tenants save money and stay within their budget.
Equation: (Tenant’s monthly income/Total monthly income) X 100 = Tenant’s portion of rent
4. Split the Rent by Bedroom Size and Amenities
To make rent splitting fairer, tenants with a bigger room and personal amenities (private bathroom, private deck, walk-in closet, private parking space, etc.) should pay more. In contrast, tenants with smaller rooms and fewer amenities should pay less. Having your renters pay the same amount while occupying different room sizes can cause unwanted conflict.
5. Split the Rent by Bedroom Square Footage
This strategy is beneficial for rooms that are similar in size but may have different shapes and angles. You could also factor in the square footage of personal amenities, i.e., who has the bigger bathroom. After you gather the measurements following equation to calculate the rent cost for each renter.
Equation: (Tenant’s bedroom square footage/Total square footage of all bedrooms) X (Total rent) = Tenant’s Portion of Rent
6. Use a Split Rent Calculator
A split rent calculator is a valuable tool that does all the math work for you. You input your information into the calculator, which then tells you how much each person should pay. Split rent calculators may have slight variations depending on which one you use, but most require the following details:
- Total square footage
- Bedroom square footage
- Number of occupants
- Shared or private bathrooms
- Additional bedrooms
Tips for Renting to Multiple Tenants
Anything can happen when renting to one person, so imagine all the unexpected situations that may occur when you are renting to multiple tenants. To better navigate and manage this condition, here are some tips:
Prohibit subleasing
From starting a family to getting a new job, there are many legitimate reasons a tenant might want to move out. In such cases, they may try to sublease their part of the deal to a sublessor. While this can seem harmless, it could do more harm than good. Sublessors do not sign the rental agreement, so it is harder to hold them accountable if they stop paying rent or damage your property. Protecting your interests and replacing the renter with a new tenant is better.
Inform tenants about how their actions can impact everyone
People have different personalities and lifestyle habits that work fine on their own. But when multiple tenants room together, their unique behaviors can affect everyone, sometimes negatively. Encourage your tenants to be mindful and respectful of boundaries, responsibilities, and rules to help avoid conflicts. When your tenants can live in peace and harmony, that means fewer disputes you must referee.
Include a joint and several liability clause
A joint and several liability clause is a rule holding all tenants responsible for the rent. Even if one of your tenants doesn’t pay their portion of the rent, that doesn’t absolve everyone else. Your tenants are equally accountable to pay the total rent each month. Include a joint and several liability clause in the lease agreement and make sure your tenants understand what it means.
Have your tenants elect a representative
While not mandatory, encourage your tenants to vote or appoint someone as the primary representative. This individual will be your first point of contact regarding rental concerns, such as maintenance requests and rent payments. A person you can consistently speak to makes communication more accessible and fluid. The representative shouldn’t be responsible for all incidents, though. In situations where you cannot reach them, a secondary contact is beneficial.
Avoid dividing the security deposit
Before your tenants sign the lease agreement, let them know you will not divide the security deposit. And when you return the deposit, they will only get it in one check. To eliminate any confusion, you should also specify this within the lease. Ensure your tenants understand they can expect the security deposit after you conduct a damage assessment and everyone vacates the rental property.
Require renter’s insurance
In a house full of tenants, renter’s insurance is more important than ever. This coverage can protect your tenants in case their personal belongings are damaged or stolen from the property. Your tenants must prepare for the possibilities, like someone leaving the door unlocked or accidentally breaking a roommate’s television. When accidents occur, having your tenants register for renter’s insurance means less weight and liability on your shoulders.
Screen new tenants
Eventually, some of your tenants might decide not to renew the lease agreement. When this happens, don’t just accept anyone to fill the vacancies. It's essential to screen these tenants before they sign the lease. Apartments.com makes it easy to screen tenants, get the information you need, and find a qualified renter fast. Unlike our competitors, who use various third-party resources to collect information, we partner with TransUnion to provide you with screening reports for evictions, credit, and criminal history. Another feature you’ll find only on Apartments.com is support for co-signers, guarantors, and co-applicants. If you need more information to make a decision, you can request supporting documents from potential tenants directly on our platform. Get all the information you need to find the right tenant quickly and easily.
Handle rent splitting disagreements tactfully
When it comes to multi-tenant contracts, disagreements can occur. Arguments about who should pay this amount or who missed their portion last pay period are common issues you can expect to come across. Some tenants might even take issue with you about the rent splitting. Whatever the problem is, always handle it with tact and grace. Listen to what they have to say and communicate clearly about their concerns or your own. Refer them back to the lease agreement—your bread and better. Keep an eye on the situation and manage conflicts before they escalate.
Frequently Asked Questions
What happens when one tenant does not pay their portion of the rent?
When one renter does not pay their portion of the rent, the tenants must determine how to cover the missing rent or urge their roommate to pay it. Because of the joint and several liability clause, your tenants are still responsible for the portion someone does not pay.
What should I do if one of my tenants violates the rental agreement?
Warn them about the rule they violated and what penalties they may incur if they break it again. If they continue violating the rental agreement, inform them they’re getting evicted and then go through the proper legal channels to begin the eviction process.
What are the pros and cons of splitting rent with multiple tenants?
Here are some pros and cons of having multiple tenants split rent:
- Pro: It’s more affordable for the tenants
- Pro: It’s easier for tenants to save money
- Pro: Sets a standard and reduces interpersonal drama
- Pro: Tenants can pay privately
- Pro: Tenants can divide the costs of property damages
- Con: It can lead to more disputes about rent payments
- Con: Tenants may become unhappy with the living situation
- Con: Tenants must deal with each other's habits
- Con: Higher chance of property damage
A Simpler Solution to Collect Rent From Multiple Tenants
While renting to multiple tenants presents unique challenges, collecting rent from them should be a simple process. Understanding your options is the first step to getting your monthly payments on time and in full.
However, there’s an even simpler option.
Apartments.com’s rent payment system is the easiest solution of all. Enjoy a hassle-free system that allows for automatic payments. Feel at ease knowing every payment from your tenants is safe and organized in one convenient location. And the best part about it—there are no extra or hidden fees for you as the landlord. Add your property to Apartments.com to collect fast, secure, and easy monthly rental payments.
