Renting in a shared apartment

Many owners, when renting a property with 2 or more bedrooms, find themselves faced with requests for shared accommodation.

Renting to roommates can be a quick and (a little) more expensive way to rent, however, rental management is more complex and contains some pitfalls.

Here is a summary of the different points that are worth paying attention to if you decide to rent to roommates.

Definition of colocation

A quick reminder to define what a shared flat for a living room as a main residence corresponds:

I. - Joint tenancy is defined as the rental of the same accommodation by several tenants, constituting their main residence, and formalized by the conclusion of a single contract or of several contracts between the tenants and the lessor, with the exception of rental granted exclusively to spouses or partners bound by a civil solidarity pact at the time of the initial conclusion of the contract.Source: article 8-1, law of July 6th, 1989

In short, if you rent to two or more people, unmarried or not in a civil partnership , they are roommates. The 1989 law specifies that you can rent in single lease or through several leases.

Single lease or room sharing?

When you decide to rent accommodation in the classic way, by default the roommates who will contact you will want to rent on a single lease. The single lease in colocation is therefore the default contract.

The problem is that shared flats, ready to rent out your one-block accommodation, are rare in some areas. Investors who wish to maximize their returns in co-tenancy therefore sometimes opt for joint tenancy by single lease. In this system, each room becomes a private part subject to an individual lease, the roommates sharing the common parts of the accommodation in annexes.

Solidarity of roommates

When drafting a single roommate lease, the question arises of the solidarity of the roommates. The solidarity clause which is usually inserted in leases allows any tenant to be sued for all the debts of the joint tenancy.

This greatly simplifies any litigation and reduces the risk of one of the roommates becoming insolvent during the lease.

It is therefore a clause that we offer by default via the digital lease, especially since we will see that unpaid rent insurance requires this solidarity clause.

Note that the ALUR law has changed the scope of solidarity, and requires it to expire no later than 6 months after the departure of one of the roommates or upon replacement. This avoids the ubiquitous situations where roommates, left for several years from a roommate, were asked to pay for the debts of roommates who had changed dozens of times at the option of replacements.

Inventory of shared accommodation

You sign a single roommate lease with 3 roommates, for example, it is important to fill out a second document in the process: the entry inventory .

Nothing special about this entry into the premises for a roommate, with the exception of signatures: we recommend that all roommates sign the document , or that absent roommates sign a power of attorney to the roommate present, delegating to him the right to note the state of entry and sign for them.

Note that degradation problems are complex to manage in shared accommodation, so it is important to have the most secure entry inventory possible.

Security deposit for roommates

In a joint tenancy in a single lease, the security deposit is considered to be paid by the joint tenancy as an indivisible entity, regardless of the person who actually pays the funds.

Unless otherwise specified in the lease which would divide the security deposit (which we do not recommend), a roommate A can pay the entire deposit, it will be allocated without distinction to any damage to the co-location as a whole, and therefore of all roommates A, B or C.

This is an important point to keep in mind when leaving a roommate.

Guarantor and unpaid rent insurance

The two classic solutions to guarantee the rents of a shared apartment are the guarantors and the unpaid rent insurance.

Insurance can cover shared accommodation provided that it is a single lease with a solidarity clause. In this case, it is possible to sum the income of roommates with eligible status to reach the necessary income threshold.

Instead of unpaid rent insurance coverage, you can choose the guarantors option. They will sign deeds of joint and several guarantee . The custom for a joint tenancy is to have signed deeds of joint surety which covers de facto the entire rent.

The ALUR law has also changed the solidarity of the guarantors in the event of the departure of the roommate, which ends at the same time as the solidarity of the roommate. As a result, even if the guarantor stands surety for the entire rent, it is crucial to identify on his surety deed the tenant whose departure extinguishes his guarantee obligation.

Last particular point we wanted to address: the combination of guarantors and insurance for student roommates. The law allows to combine guarantor and insurance only for students. In the case of a roommate, all the roommates must therefore be students, an employee-student mix is ​​not allowed. It is therefore sometimes necessary not to indicate certain roommates on the lease if they are not students.

Home insurance for a shared apartment

When entering the premises, roommates are required to take out home insurance covering rental risks such as water damage or fires.

Some insurers find it difficult to properly manage joint tenancies, especially when there is any change in occupants. It is therefore possible for the owner to take out this home insurance on behalf of the roommates and to re-invoice them.

Re-invoicing of shared rental charges

Charges are a complex subject in shared accommodation, to such an extent that the law provides for a specific case which allows a flat rate of charges to be billed to roommates in empty rental (this is possible for all roommates in furnished rental).

We strongly recommend to choose this package, otherwise the management of charge adjustments in the event of a roommate's departure will become a real nightmare.

The flat rate charges allow you to invoice common charges, but what about private charges (water, electricity, internet)?

As much as we are in favor of taking private subscriptions by the owner on an individual lease, as much as a single joint lease, we recommend letting tenants manage their private expenses and their internal re-invoicing.

Payment of rent and receipt

As we have seen, the big advantage of the single joint tenancy lease with a solidarity clause is to consider the roommates as an indivisible whole, without needing to keep separate accounts per roommate .

There cannot therefore be a defined rent per room or per roommate, unless otherwise specified in the lease (which we do not recommend).

In short, the rent can be paid by any roommate, as long as at the end you receive the full rent. To simplify management, you may include a clause in the lease obliging that a single roommate pays the entire rent, and that he requests re-invoicing from his roommates.

For the receipt the principle is the same, you issue a single receipt , in the name of all the roommates, for the entire rent, regardless of the share paid by each.

It is therefore not necessary to issue a receipt per roommate for this reason.

Unpaid in a shared apartment

The management of an unpaid single lease with a solidarity clause is made much simpler than for a single non-joint lease or several individual leases. Solidarity makes it possible to start the recovery procedure on just one of the roommates, several of them or all of the roommates. The same principle applies for guarantors.

Solidarity often leads in practice to an amicable resolution of conflicts , insofar as the social pressure of the roommates vis-à-vis a bad payer encourages them to ask for the termination of the lease or the departure of the bad payer.

Departure and replacement of a roommate

The only complex management problem that remains when concluding a single roommate lease is the management of departures of roommates .

Indeed, contrary to what one might think, one of the roommates can give leave unilaterally , without questioning the initial lease that continues with the remaining roommates.

As the solidarity ends 6 months after his departure, the owner has an interest in accepting a replacement by a new solvent roommate, but unlike a roommate via individual lease, he cannot impose a new roommate on the remaining roommates , since by definition they are at home.

This is the main reason why we recommend taking out unpaid rent insurance with shared accommodation and avoiding guarantors whose activation is random. The insurance will cover you even if the roommate crumbles and ultimately only one insolvent roommate remains.

One of the roommates decides to leave, what about any damage and the security deposit? If the roommate is not replaced , the principle is quite simple, the lease continues under the same conditions, the security deposit is retained and may be used to charge deductions when the lease is terminated. The roommates are free to make internal accounts in order to offset the security deposit but this is not the owner's problem.