How to Make Extra Money by Subletting
"We worked closely with the daughter of the owner of the building," says Barth. "And we just assumed everything was in order and that everyone had been made aware of the situation when she agreed to let us use the space -- which was beautiful, spacious and easy-to-find."
The Harlem Yoga Studio spent its first 10 months in that sublet; however, when the business was hit with a call from a lawyer asking them to vacate, Barth and her partner realized that things had not been organized correctly after all. "Sharing a space always has its challenges," says Barth. "For us, having to move quickly was especially tough, since we had to let our clients know where to find us, on top of everything else."
If you are a renter interested in subletting, here are the rules:
1. Yes, your building management needs to know
If you are going to sublet any part of your apartment honestly, it is in everyone's best interest to let all parties in on it. So, for example, if your roommate moves out, in most cases the management will be fine with you organizing a replacement. Most of the time, they won't even insist that the new tenant be put on the lease. In this case, you can write up your own subletters' agreement. (And while it may not be the most ethical thing in the world, you can probably get away with charging your subletter more than what you pay, but you didn't hear it from us.)
2. See what's sublet-able to make a little extra $$$
Look around your home. Do you have an extra parking spot? An empty basement or garage? Do you have a spare
3. Consider zoning
If your building is zoned residential, you are not legally allowed to operate as a commercial space. In other words, if you think your living room would make a great boutique and plan to rent it out as such to a local shopkeeper, be wary of zoning laws in your area. You might get in major trouble, not just from your building manager, but from your city's law enforcement.
4. Make sure that commercial spaces have a commercial certificate of occupancy
If you are living above an empty commercial space and want to make a deal with your landlord to share in the profits of getting it rented out, make sure the space has a commercial certificate of occupancy. This is a legal document that ensures a building is up to code before it is rented out. Every city has a different application form, and they're easy to find online. If you don't do it, you or your landlord could get in trouble.
5. Become your building's manager
If you live in a building with a lot of vacancies, you might have a landlord who is just too busy to keep it full. You could offer him or her a hand at keeping the building occupied in exchange for a cut in rent or for a commission on the rent that you bring in. In this way, you are free to make choices (and money) that would otherwise go to The Man.
If you are creative about subletting, there are all kinds of ways to share your space for cash without anyone stepping on anyone else's toes. Just make sure that you come up with a written agreement to protect yourself, and let your landlord in on it when possible.
"Now we are legitimately renting at Black River in Harlem," says Barth, of her popular yoga studio. "There are no hard feelings. Subletting is a complicated world!"
Complicated, yes, but impossible? Not at all. And potentially quite lucrative if done right.
Joselin Linder is co-author of "Game-Based Marketing" (Wiley and Sons, 2010).
Want to know how to deal with other rental issues? Here are some AOL Real Estateguides that can help:
- Tips for Finding a Rental Apartment
- Apartment Security for Renters
- Are You Paying Too Much for Your Rental?
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