would it be unethical to make a profit off of a roommate?

nageov3t

Lifer
Feb 18, 2004
42,808
83
91
so, this up-coming spring, I'm probably moving into a 2-bedroom apartment, the second apartment in a 2-family house that my 90 year-old great aunt owns/lives in. she's going to be charging me a significantly reduced rent because I'm family and will presumably also be helping to run errands for her and take care of stuff around the house like shoveling, taking out the garbage, etc.

my aunt is going to be charging me $600/month for the place. fair market price for the apartment would probably be about $1200

would it be completely unethical/douchebaggy to have a friend move in and charge them like $500/month?
 
Oct 27, 2007
17,009
5
0
Not douchebaggy towards the friend, no. But extremely douchebaggy towards Grandma if she doesn't get a cut of it.
 

chusteczka

Diamond Member
Apr 12, 2006
3,399
3
71
That is ethical. Your family has an asset. The controller of that asset is giving you a personal break on the costs. You may want to discuss your potential arrangement with your aunt.

Personally, I would not be bothered if I was your friend paying the $500 for rent of one bedroom.
 

Ika

Lifer
Mar 22, 2006
14,264
3
81
Not douchebaggy towards the friend, no. But extremely douchebaggy towards Grandma if she doesn't get a cut of it.

Pretty much, this. As long as your friend pays a lower rate than normal too, especially if he is really a friend and not some guy you want to split the rent bills with.
 

rcpratt

Lifer
Jul 2, 2009
10,433
110
116
I don't see any problem charging fair market value for the other room. You probably should let your aunt know, though...my guess is that she won't mind.
 

waggy

No Lifer
Dec 14, 2000
68,143
10
81
i don't see a problem either. just be warned when the friend finds out its not going to be pretty.
 

zinfamous

No Lifer
Jul 12, 2006
111,614
30,890
146
Pretty much, this. As long as your friend pays a lower rate than normal too, especially if he is really a friend and not some guy you want to split the rent bills with.

bingo bango.


just don't be posting granny pics here on AT.
 

MJinZ

Diamond Member
Nov 4, 2009
8,192
0
0
so, this up-coming spring, I'm probably moving into a 2-bedroom apartment, the second apartment in a 2-family house that my 90 year-old great aunt owns/lives in. she's going to be charging me a significantly reduced rent because I'm family and will presumably also be helping to run errands for her and take care of stuff around the house like shoveling, taking out the garbage, etc.

my aunt is going to be charging me $600/month for the place. fair market price for the apartment would probably be about $1200

would it be completely unethical/douchebaggy to have a friend move in and charge them like $500/month?

Well, two results:

Pay $100 to live with a room-mate and do some chores, Aunt gets less
Pay $350-600 to live with a room-mate and do some chores, Aunt gets more

There is no ethical dilemna here at all, only how much you want to help/appreciate your Aunt. If you consider that many companies will lease properties and will sublease space for profit.
 
Last edited:

LumbergTech

Diamond Member
Sep 15, 2005
3,622
1
0
i don't think its ethical personally..unless they know

just because its a friend

at least in my friendships there is a presumption of a degree of transparency
 

Lean L

Diamond Member
Apr 30, 2009
3,685
0
0
idk why ppl make a big deal of this. I once had my rooommate get so offended because I tried to sell him my speakers because I found a good deal on ebay. It was still gonna be for a lot less than retail.
 

nageov3t

Lifer
Feb 18, 2004
42,808
83
91
"profit" might not be the right word. I figure, there's 3 possible scenarios:

-live by myself, pay $600/month in rent + $250 in utilities (total cost to me = $850)
-live with a roommate, roommate pays $500/month in rent and I cover the rest (total cost to me = $225)
-live with a roommate, split all costs equally (total cost to me $425)
 

JulesMaximus

No Lifer
Jul 3, 2003
74,544
924
126
i don't see a problem either. just be warned when the friend finds out its not going to be pretty.

It's just business, his roommate/friend can always go find another room to rent at the same or higher rate if he doesn't like it.

Friends are welcome to stay with me for short periods of time. If they want to rent a room they're going to have to pay me rent. It's up to me what that rent is and it's really nobody's business but my own what that rate is.
 

nonameo

Diamond Member
Mar 13, 2006
5,902
2
76
Charge him 400, give the aunt 200 and keep 200 for yourself. You both end up paying 400/mo for rent, you get a whole house, he gets a good deal on a room, and auntie gets an extra 200 bucks.
 

Miramonti

Lifer
Aug 26, 2000
28,651
100
91
This

I'm not sure why you're charging the roommate, you don't own the place.

I don't know what that has to do with it, altho it does come to mind that getting another tenant should be approved by the aunt. She's giving you a reduced rent because of the benefits of living next to a relative, one of which being increased feeling of security.

Getting an 'unknown' roommate might undermine part of her intention of wanting you there and for giving you such a reduced rent to encourage you to move there. She also might have an opinion about you keeping all the money. Sounds like she's in pretty remarkable shape mentally for her age.
 

Sahakiel

Golden Member
Oct 19, 2001
1,746
0
86
In college, I rented a room in a house owned by my friend's parents. It was an investment property, by virtue of taking advantage of the bubble to raise the value of the property. Money otherwise spent on rent while in school went to mortgage payments and my friend helped maintain upkeep of the property. I rented the room for less than market and my friend obviously paid nothing.
Was I resentful? No. It was a reasonable arrangement between me and his parents. I got cheaper rent, they got peace of mind with a known, stable, tenant and the discount reflected the relationship. Would I have willingly paid market price? Yes, and I would not be resentful either. I needed a place to stay and paying my friend's parents is no different than paying a landlord. I would even have been willing to pay a bit more than I normally budget just for the security and peace that comes with rooming with a friend.

I don't see a special case in your aunt leasing the unit to you at a reduced rate. Part of the discount comes from a general sense o helping family members, the other part comes from you helping her with chores/errands.
Now, adding your friend as a tenant, even as a sublease, does not involve any of the above. Therefore, what happens with rent is between him and the landlord (your aunt).

In conclusion:
On the one hand, charging a friend rent is not unethical in and by itself.
On the other hand, subletting without the landlord's consent is unethical and more than likely illegal.
Raise the question with your aunt about subletting to your friend. Let them deal with it since it's their business and theirs alone.
If she gives him a discount on account of your relationship and he agrees to it, she gets more rent money, your friend gets a roof overhead, and you acquire a better living arrangement. All parties involved are better for it.
If she refuses due to principle, legality, or whatever, you can not reasonably expect resentment from your friend and you do not incur liability for illegally subleasing.
 

Strk

Lifer
Nov 23, 2003
10,197
4
76
I don't know what that has to do with it, altho it does come to mind that getting another tenant should be approved by the aunt. She's giving you a reduced rent because of the benefits of living next to a relative, one of which being increased feeling of security.

Getting an 'unknown' roommate might undermine part of her intention of wanting you there and for giving you such a reduced rent to encourage you to move there. She also might have an opinion about you keeping all the money. Sounds like she's in pretty remarkable shape mentally for her age.

I'm just saying the money should go to the aunt and not him.
 

0roo0roo

No Lifer
Sep 21, 2002
64,795
84
91
you have to cut the aunt in. else she's going to be pissed if she finds out.
 

rudder

Lifer
Nov 9, 2000
19,441
86
91
Not douchebaggy towards the friend, no. But extremely douchebaggy towards Grandma if she doesn't get a cut of it.

pics of grandma?

But yeh... definitely douchiness towards his grandma. She could rent it out for a lot more and if something breaks... she has to pay it. So I would charge the roomie fair market value... and set the jack aside in case a water heater blows or something.
 

bignateyk

Lifer
Apr 22, 2002
11,288
7
0
I'd be pretty pissed if I let a relative move into my place for a discount, and then they let someone else move in.

I would definitely want to up the rent.