When I first started renting rooms in my home, I did not have everything figured out. I learned most of it by doing. Some lessons came from small inconveniences. Others came from mistakes I never wanted to repeat.
The good news is that most of these mistakes can be avoided if you think through the process before the first housemate moves in.
Starting With Too Small of a Security Deposit
When I started out, I only charged a $100 security deposit. I quickly discovered that some people had no problem walking away from a $100 deposit if something better came along. After realizing my mistake, I decided to raise the deposit amount to 50% of one month’s rent. I could have made it 100%, but I was concerned that it would deter some good renters. Also, past experience taught me that if I filled the vacancy within two weeks of them moving out, I didn’t lose any revenue. You need to discover what works best for you and your particular marketplace.
Making Exceptions to Overnight Guest Rules
One mistake I made was allowing an exception to my no-overnight-guest rule. A good housemate had a girlfriend who lived more than 60 miles away, and one rainy evening he asked if she could stay overnight. I liked them both and I felt sorry for them so I agreed.
The problem was that one exception quickly became an expectation. Before long, another housemate wanted the same exception for his girlfriend. Suddenly, instead of managing a house with three housemates, I had extra people using the kitchen, bathroom, parking, and common areas.
That experience taught me an important lesson: if I make an exception for one housemate, I need to be prepared for every other housemate to expect the same exception.
For me, the cleanest rule is simple: no overnight guests.
I cover this issue in more detail in my article on visiting hours and overnight guests.
Learning Airbnb Was More Work Than Expected
When I first tried Airbnb, I liked the idea of earning money from unused space without committing to a long-term housemate.
Afterward, I realized that short-term rentals require more hands-on management than many people realize. New guests ask lots of questions so it requires considerably more communications. After every guest checks out, there is cleaning to do plus re-scheduling availability. You will also be asked to critique the tenant after they check out and they will be doing a critique of you as a host.
For me, Airbnb created more cleaning, communication, turnover, scheduling, reviews, local rules, taxes, and fees than I expected.
Realizing Written House Rules Were Necessary
When I first started renting rooms in my home, I assumed most people shared the same ideas about cleanliness, guests, noise, and common courtesy.
I quickly learned that what seems like common sense to one person may not be common sense to another.
Just because the refrigerator is shared doesn’t mean everything in it is shared. One housemate usually kept a 6-pack of beer on hand. The other housemate didn’t, but he did enjoy having a cold one. When he drank one of his housemate’s cans of beer, he justified it because he was going to replace it. Unfortunately, there was no time frame on when he was going to replace it.
That is when I learned that house rules should not live in my head. They need to be written down, reviewed before move-in, and applied consistently.
Learning to Verify Legal Names Carefully Before Background Checks
I ran a background check on an applicant and it came back clean so I decided to rent to him. About a month after he had moved in two police officers and a parole officer came to my house while I was gone. They had the combination to my digital front door and after knocking, they entered my house (I have it on video). The person they were looking for was not there, but one of my other housemates was and he called me immediately to alert me. The police asked him which room belonged to the person they were looking for and they searched his room (for drugs).
They were gone when I got home so, I immediately called my local police department to find out what was going on. The officer told me they believed they had authority to enter and search his room because he was on parole and had reported my address as his residence.
I realized afterward what a serious mistake I had made. For the background check I used the name the applicant gave me on his rental application instead of his driver’s license. That’s why no match was found on the background check.
I explain this story in more detail in my screening article, but the lesson was clear: always run the background check using the applicant’s legal name exactly as it appears on their government-issued ID.
Discovering That Screening Begins with the First Contact
I learned that screening does not begin with the application. It begins with the first message or phone call. Move-in timing, length of stay, ability to verify income, transportation, and attitude all tell you something before you ever schedule a showing.
By the time someone fills out an application, I have usually already learned a lot about whether they are likely to be a good fit.
Learning That Cheap Rent Can Attract the Wrong Applicants
Pricing too low can attract applicants who are focused only on finding the cheapest possible place to live, rather than finding the right shared living situation. I am not trying to be the cheapest option in town. I am trying to offer a clean, safe, furnished room at a fair price to the right housemate.
Final Thoughts
Most of the mistakes I made as a new live-in landlord came from assuming things would work themselves out.
I assumed a small security deposit was enough. I assumed occasional overnight guest exceptions would not matter. I assumed most people understood basic house rules the same way I did. I assumed a background check was only as good as the name written on the application.
Over time, I learned that a successful room-rental arrangement needs a system.
That system includes proper pricing, a meaningful deposit, clear house rules, careful screening, written agreements, and consistent enforcement.
Renting rooms in your own home can be a very good arrangement, but it should not be casual. You are choosing people who will live inside your home and share your kitchen, bathroom, laundry, parking, and common areas. The more clearly you handle things from the beginning, the fewer problems you are likely to have later.
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