As the cost of living in Canada increases, so too does the number of tenants living together. According to recent census data released by Statistics Canada, the number of households composed of two or more unrelated persons leapt 54% from 2001 to 2021.
This fast-growing trend has been hastened by runaway house prices, and will no doubt help to put the brakes on price growth. Until then, the conditions are ripe for more house-sharing: unaffordable mortgage rates are driving away potential homebuyers, sparking more demand for rental properties. At the same time, inflated rent prices are forcing tenants to share accommodation to save money.
PayProp to the rescue
The trouble with roommates used to be that tenancies are managed separately, even though they reside under one roof, adding complexity to the property management mix. But that was before automation. Although multi-tenancy in single-family rentals comes with its share of concerns, adopting PropTech is enabling property managers to more easily facilitate this increasingly common living arrangement.
Take payments, for instance. Whether renting jointly and severally or by the room, even complicated payments are made simple by automating your payment rules. PayProp allows property managers to set and forget flexible and specific payment instructions per property before anyone even moves in.
With PayProp’s split payment capability, each tenant can automatically be invoiced separately for their portion of the rent, and their payments pooled and distributed according to settlement rules that can be equally complex and flexible but quick and easy, thanks to unerring machine logic.
For example, if a property manager wants to achieve a yield of $1,000 per month on a four-bedroom property, he or she may split the rent $275 x 3 for bigger bedrooms and $175 x 1 for another bedroom that is smaller.
From the separate income streams, reconciled rent is further automatically split into each tenant’s respective portions of the agent management fee, contractor invoices, property account allocation and landlord dues based on pre-established payment rules. These rules only need to be set up once and can run for the lifetime of the lease or until changed.
And there’s no need to chase down roommates individually, should one or more miss a payment. Polite and legally compliant arrears reminders can be sent concurrently via text message and/or e-mail to all tenants living in a single-family property.
The PayProp Tenant portal, which is branded with the property management firm’s name, logo and contact details, further facilitates communication with multiple tenants, as any roommate can use it to view their invoices and payment history, make instant EFTs, or submit maintenance requests on behalf of the whole property, visible to the property management firm and all tenants.
Done right, renting to roommates is a smart decision
As tenants adapt their living arrangements to weather Canada’s current 7.6% inflation rate, property managers may want to open their single-family doors to households outside of the traditional census family. No matter how many roommates enter a single lease agreement, PayProp is there to help make the management of multi-tenant properties as smooth as can be.