What happens if you move into or out of an apartment or rental home in the middle of the month? Are you expected to pay the full month's rent? That can depend on the laws of your city or town and the agreement you made with the landlord.
Laws relating to a landlord's responsibility to prorate rent and how it's calculated vary by location. If you own an investment property in South Carolina, check the laws regarding the landlord-tenant relationship.
All competent property managers must know how to calculate prorated rent as it comes up in many situations. Keep reading to learn more in this guide to prorated rent calculations.
What Is Prorated Rent?
Prorated rent is the portion of the monthly rent that a landlord charges a tenant for the number of days they live in or have access to their property. Rather than charge a daily or weekly rate, the monthly rent is divided by the number of days in the month to come up with the prorated amount.
For example, if the rent is $2000 per month and you move in on June 11th, you divide 2000 by 30. That number is then multiplied by 20 for the number of days in June that you occupy the property.
This is the amount a landlord charges for part of the base rental period. In this case that would be $1333.33 for the partial month.
Why Prorate Rent?
In a lot of cases, owning rental homes or investment property means you enjoy passive income. When you count on rental income, it's tough to lose a partial month's rent.
What is the reason to prorate rent then? The best explanation is that it's a fair way to do business with your tenants. If a tenant does not occupy the property for the full month, it's only fair to prorate the rent.
Being fair with your tenants helps you develop a good relationship and a good reputation. The landlord gets the correct amount of rent and the tenant only pays for the time spent at the property.
When Can You Ask Property Managers for Prorated Rent?
Since there are no state or federal laws about prorated rent, it is usually up to the landlord or local law. Most landlords will agree to prorate rent when you move in after the beginning of the month. It's not uncommon for prorated rent when moving in, but it's less common when moving out.
If you decide to move out in the middle of the month, most landlords will expect you to pay for the full month. If you know ahead of time that you can only stay for a partial month towards the end of your lease, you should request prorating as part of your lease agreement when discussing with the property manager.
Tips to Keep in Mind
When calculating prorated rent, there are a few things to remember to make it an easy process. Put your prorating policy in writing if you choose to allow it. Prorating rent is not mandatory.
Flagship Property Management is a prominent full-service real estate company in Upstate South Carolina. Schedule a call with us so we can show you how our property management services will give you more money in your pocket.
