{"id":779,"date":"2021-06-07T15:12:06","date_gmt":"2021-06-07T15:12:06","guid":{"rendered":"https:\/\/ctre.wpenginepowered.com\/?p=779"},"modified":"2022-06-18T11:50:55","modified_gmt":"2022-06-18T11:50:55","slug":"multiple-tenants-and-sub-letting","status":"publish","type":"post","link":"https:\/\/www.ctrealestate.com.au\/zh\/multiple-tenants-and-sub-letting\/","title":{"rendered":"Renting Out To Multiple Co-Tenants: What Are The Risks Involved?"},"content":{"rendered":"<div style=\"padding: 20px; background: #f5f5f5; border-radius: 3px; border: 1px solid #d0d0d0; display: block; max-width: 500px; float: left; width: 100%; margin: 15px;\">\n<ul>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: #b5871be8; text-decoration: none; margin-bottom: 5px;\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/renting-your-property-a-guide-for-landlords-by-ct-real-estate\/\"><strong>Introduction:<\/strong><\/a><\/li>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: #b5871be8; text-decoration: none;\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/leasing-out-your-property\/\"><strong>Part 1: Leasing Out Your Property<\/strong><\/a><\/li>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: #b5871be8; text-decoration: none;\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/getting-the-most-out-of-your-property\/\"><strong>Part 2: Getting The Most Out Of Your Property<\/strong><\/a><\/li>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: #b5871be8; text-decoration: none;\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/choosing-the-right-tenants\/\"><strong>Part 3: Choosing The Right Tenants<\/strong><\/a><\/li>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: #b5871be8; text-decoration: none;\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/what-property-managers-do\/\"><strong>Part 4: What Property Managers Do<\/strong><\/a><\/li>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: gray; text-decoration: none;\"><strong>Part 5: Multiple Tenants And Sub-letting<\/strong><\/a><\/li>\n<li style=\"list-style-type: none;\"><a style=\"display: block; color: #b5871be8; text-decoration: none;\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/calculating-the-costs-of-renting-out-your-property\/\"><strong>Part 6: Calculating The Costs Of Renting Out Your Property<\/strong><\/a><\/li>\n<\/ul>\n<\/div>\n<p><span style=\"font-weight: 400;\"><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone size-large wp-image-1116\" src=\"https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_-1024x682.jpg\" alt=\"\" width=\"640\" height=\"426\" srcset=\"https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_-1024x682.jpg 1024w, https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_-300x200.jpg 300w, https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_-768x512.jpg 768w, https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_-18x12.jpg 18w, https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_-350x233.jpg 350w, https:\/\/www.ctrealestate.com.au\/wp-content\/uploads\/2021\/06\/renting.ct_.jpg 1160w\" sizes=\"(max-width: 640px) 100vw, 640px\" \/><\/span><\/p>\n<p>The most common way to rent out your property is to a single tenant but should you also start considering renting out to multiple tenants?<\/p>\n<p><span style=\"font-weight: 400;\">In some cases, having multiple tenants can be financially advantageous but it does not come without risks.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">How do you decide? Below we look at some of the risks involved, but first, let\u2019s understand what the different rental arrangements mean.\u00a0<\/span><\/p>\n<h1><span style=\"font-weight: 400;\">Types Of Rental Arrangements<\/span><\/h1>\n<p><span style=\"font-weight: 400;\">There are 2 main ways that you can rent out your property:<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u00a0 \u00a0 \u00a0 1. Rent out the whole unit<\/span> <span style=\"font-weight: 400;\">under <\/span><b>one contract\u00a0<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Renting out to a single party involves only one contract, which means it&#8217;s fairly straightforward. This is the traditional method of renting out a property, making tenant management a lot easier<\/span><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u00a0 \u00a0 \u00a0 \u00a02. Rent out to <\/span><b>multiple tenants<\/b><span style=\"font-weight: 400;\"> under <\/span><b>multiple contracts\u00a0<\/b><\/p>\n<p><span style=\"font-weight: 400;\">If a property has multiple rooms, there is the option of renting out the individual rooms to different tenants<\/span><span style=\"font-weight: 400;\">. This method of renting, referred to as rooming, is common in areas close to universities as students are usually not able to afford renting out an entire property on their own.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A rooming house refers to a property where 4 or more people live together in rented rooms<\/span><span style=\"font-weight: 400;\">. The rooming house is managed by an operator, who also has the authority to decide who lives in the property without consulting residents<\/span><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Renting out the rooms individually is an attempt at utilising the property to its full potential. Also, in some cases you could generate higher income from renting out to multiple tenants.<\/span><\/p>\n<h1><span style=\"font-weight: 400;\">Some Units May Work For Multiple Tenants\u00a0<\/span><\/h1>\n<p><span style=\"font-weight: 400;\">Certain properties may be more appropriate for rooming vs. others. Such as, properties that are in close proximity to colleges or universities and have multiple rooms.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Landed properties are typically more suitable for renting out to multiple tenants because there is more space and privacy involved. However, while renting out rooms in apartments to multiple tenants is also an option, this would depend on how much space is available.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Having multiple tenants could mean more income. For example, you may only be able to rent out a whole unit to a family for $1500 but if you were to rent it out to multiple tenants, you could rent it at $600 per tenant<\/span><span style=\"font-weight: 400;\">. This is because, while $1800 may be too expensive for the family to bear, breaking up the charges between 3 tenants would be more affordable.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">All things considered, there are still risks to renting out to multiple tenants.<\/span><\/p>\n<h1><span style=\"font-weight: 400;\">What Are The Risks Of Renting To Multiple Co-Tenants?<\/span><\/h1>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h2><span style=\"font-weight: 400;\">Shorter Leases\u00a0<\/span><\/h2>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Properties that rent out to multiple tenants tend to attract less reliable tenants which are only able to commit to short term leases<\/span><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As we mentioned earlier, some of these tenants are university students that do not have stable incomes and therefore cannot commit to longer leases. Shorter leases would mean less certainty and the need to look for new tenants more frequently.\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h2><span style=\"font-weight: 400;\">Higher Maintenance Costs<\/span><\/h2>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Home owners are responsible for maintaining common areas such as hallways, courtyards, parking lots etc<\/span><span style=\"font-weight: 400;\">. This also includes plumbing systems, roofing, heating and cooling systems and other maintenance costs involved in the home<\/span><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Having more tenants would mean more wear and tear and may lead to higher maintenance costs. Keep in mind that each tenant may have their partners or friends dropping by and using the house.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">All of this can add up quite rapidly, which is why maintaining multiple tenant properties can end up being quite expensive.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h2><span style=\"font-weight: 400;\">Requires A Licence<\/span><\/h2>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Another thing you will need to rent out your property under rooming house arrangements is a rooming house operator licence. This falls under Section 16 of the Rooming House Operator Act and will require you to apply for the licence and provide necessary documentation. This will take time and cost you about $240 in fees.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">You will also need to register your house under Division 4 of Part 6 of the <\/span><i><span style=\"font-weight: 400;\">Public Health and Wellbeing Act 2008. <\/span><\/i><span style=\"font-weight: 400;\">Failure to do so can result in heavy penalties.\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h2><span style=\"font-weight: 400;\">Higher Chances Of Vacancy\u00a0<\/span><\/h2>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">This relates to our first point where multiple tenant properties typically have shorter leases. In this case, there is a higher chance of a gap in waiting time when one tenant leaves and you\u2019re looking to secure a new one, making it tricky to make full use of the space.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If this happens, it might be more difficult to ensure that income received for renting out the property covers all expenses incurred.\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h2><span style=\"font-weight: 400;\">Less Stability<\/span><\/h2>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">If you\u2019re renting out your property to multiple people, it is unlikely that you will be able to coordinate the lease periods. As such, rental returns may not be as steady.<\/span><\/p>","protected":false},"excerpt":{"rendered":"<p>Introduction: Part 1: Leasing Out Your Property Part 2: Getting The Most Out Of Your Property Part 3: Choosing The Right Tenants Part 4: What Property Managers Do Part 5: Multiple Tenants And Sub-letting Part 6: Calculating The Costs Of Renting Out Your Property The most common way to rent out your property is to [&hellip;]<\/p>","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11,7],"tags":[],"class_list":["post-779","post","type-post","status-publish","format-standard","hentry","category-leased","category-rent"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.3.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Renting Out To Multiple Co-Tenants: What Are The Risks Involved? - CT Real Estate<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ctrealestate.com.au\/zh\/multiple-tenants-and-sub-letting\/\" \/>\n<meta property=\"og:locale\" content=\"zh_CN\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Renting Out To Multiple Co-Tenants: What Are The Risks Involved? 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