Affordable Housing-One room at a time

Recently we have seen an uptick in home owners who have larger homes and want to rent out a room or a basement to generate additional income. Renting a space in your personal dwelling is different than renting a stand-alone house or apartment in an apartment complex. It comes with additional considerations such as will this person or these persons be a good fit and work with the home owner(s) in a reasonable manner? Will they respond to reasonable requests in taking care of common areas and able to make reasonable adjustments in their lifestyles to accommodate the overall well being of everyone living there? Of course there has to be good communication with the owner(s) and possibly other tenants who may be living in the same house. These types of issues cannot be screened in your typical online background check and generally need to be resolved in a face to face meeting with the owner(s). It is best to have a written set of standards/expectations that everyone agrees relating to common areas such as noise levels, number of guests, parking, etc.

There are several ways of renting out rooms in a primary dwelling that depend on the comfort level of the owner(s) and their understanding of local landlord tenant law.

1. The first would be the owner(s) who want to rent out a room and do the marketing, screening and leasing themselves. We recommend they educate themselves in local landlord tenant law by reviewing state and local statutes (e.g. State ORS 90 https://www.oregonlegislature.gov/bills_laws/ors/ors090.html, City of Portland Rental Services https://www.portlandoregon.gov/phb/72622 ) In addition we recommend joining an organization like the Rental Housing Alliance https://rhaoregon.org/ that has ongoing education classes and almost any form that you would need to manage your property.

2. The next would be owner(s) who want to rent out a room and manage day-to-day operations/interactions with the tenant such as rent collection and repairs, but don’t want to have to deal with marketing, showings, screenings and lease agreements. For people like this we offer placement agreements where we match the tenant with the property and turn the daily management over to the owner(s). We still encourage the owner(s) to become familiar with landlord tenant law so that if issues with the tenants arise they will understand the appropriate way to respond and resolve a given issue.

3. Finally, have a property management company manage the property full time in close coordination with the owner(s) and working to resolve any issues in a positive and constructive way.

Looking to the future we see this as a potential viable trend to solve several growing problems. Those problems are:

1. Affordable Housing

We hear in the news there is an affordable housing crisis that is only getting worse. Renting out a room is generally less expensive than an entire apartment. We saw this in a property we managed where the owner lived in the basement when he was in town and rented out four rooms in the rest of the his two-story house. The demographic started out younger but over time moved to older individuals who for various reasons could only afford $400 to $500 rents vs $1000 plus for an apartment.

2. Loneliness

Loneliness is an increasing issue for both young and older people. There are many reasons for this, but living in situations with opportunities to develop relationships and engage in positive and responsible ways can be one of the means of addressing this issue.

3. Community

With our culture and society fragmenting and people getting most of their social interaction online, living together in community with others can be a means of growing in our social skills and developing meaningful relationships with people we might not otherwise associate or come in contact with. To be sure, living with other people is not easy and not all issues are resolved in a positive manner, but this can be a means of beginning and restoring a sense of community in learning to live and adjust to others and learning to care about others than just themselves.

The last issue to address is government involvement. To date their solutions have only been efforts to take tired and failed policies such as rent control and implement them with a top down punitive approach that only aggravates the affordable housing problem and creates other problems such as reduced housing inventory, guaranteed rising rents and increased homelessness. How about a different positive approach like tax incentives, such as property tax breaks, for people to rent out rooms in their homes? With increasing costs of living due in part to fees and tax increases by local and state governments, people are looking for ways to offset these costs and, in many cases, just have shelter and food—particularly if they are retired and/or are on a fixed income. Another option would be to streamline the building permit process in ways that would encourage homeowners to convert basements or unused attic spaces into living units that could be rented out. I’m sure there are many other fruitful ideas out there that should be explored and after thoughtful consideration acted upon. This should be done in thoughtful collaboration with all entities involved verses the current top down we-know-what’s-best approach that local and state government are currently utilizing and that ultimately hurts the very people they are claiming they are helping.