Roommates aren’t just for college anymore. More young adults are opting to live with roommates and it’s largely driven by the economy. According to an article on Property Management Insider, the economy is expected to recede through at least 2020. That is good news for the rental industry, though, as people are reluctant to buy property in an unstable economy. The article also states that a full 50% of the rental market are people who are starting their careers as young adults. This is the demographic most likely to desire a roommate. With roommate shares likely to become more common in the next decade, property owners and investors should know what the pros and cons are and how to mitigate any potential damage.
The Pros and Cons of Roommate Shares
- You may be able to get slightly above the fair market value for your property. Roommate shares often come at a premium for the convenience of splitting the lease and the bills.
- You capture a valuable part of the market. Young adults and those starting out in their careers are looking for affordable housing away from home. The fact that you allow roommate shares could be a powerful marketing tool for your community.
- Your community may experience more turnover. Roommates tend to move out much sooner than those living on their own. Because of that, your average renter may only be around for about a year.
- There is a larger risk that your renters default on their lease. Residents living in an unhappy renter situation are more likely to walk away from their lease.
How to Make Roommate Shares Work for Your Community
The key to making roommate shares work in your apartment community is to work with an experienced property manager. Property managers can ensure that the leasing agreement between roommates covers all possible situations. This will work to protect property owners from damages. Additionally, a property manager can carefully screen applicants to ensure they have the necessary references and financials to be good residents. Going the extra mile in the application process can greatly help reduce any issues that may happen in the future.
Looking for a property management team to protect your investment? Get in touch with the Marquette Management team today. We’ll ensure your community is the best place to work, live and invest!Back to all posts