Can I purchase a 2 bedroom Philadelphia condo, live in one room, and rent the other?

Question

I am in the process of purchasing a condo in North Philadelphia. The situation is great and my offer has been accepted. I received Condo Association documents to review and have 4 days left to review them. One of the lines in the document states: "No portion of a Unit (less than the entire Unit) may be leased for any period."

This is a problem for me as the primary reason for purchasing said condo is to live in it the first year, renting out the other room. This language indicates that I can't do that. This seems a bit weird, considering I know this practice to be widespread across the city. I have a few questions:

1. Is this the same thing as Single Room Occupancy laws, or is it something specific within the Condo agreement? If its the former, I know this practice occurs everywhere and I am good. If it is the latter, that makes it riskier.
2. Since the practice is so widespread, it may just be that renters are consistently not actually signing leases, but rather just gentlemans-agreementing with the landlord. This isn't a problem if I can get a friend of mine to do it, but if its a random person this doesn't seem like a good idea?
3. The premise that I can't charge someone rent for my spare room in a property I own just seems stupid as a concept. Am I just misinterpreting what is allowed here?

Answer 1

This is not unusual.

Many condo associations are very interested in how many properties are rental properties. Even before the growth of extremely short term rentals, they knew that having too many rental properties could limit the ability of potential owners to get FHA loans.

Is this the same thing as Single Room Occupancy laws, or is it something specific within the Condo agreement? If its the former, I know this practice occurs everywhere and I am good. If it is the latter, that makes it riskier.

In many jurisdictions that have passed laws to allow these short term rentals, they have allowed community associations to enforce their rental rules. So if the governing documents limit the ability to rent part of the unit, expect that they can and do enforce it. You could hope that there are already people trying to get the documents changed, but don't count on that being successful.

Since the practice is so widespread, it may just be that renters are consistently not actually signing leases, but rather just gentlemans-agreementing with the landlord. This isn't a problem if I can get a friend of mine to do it, but if its a random person this doesn't seem like a good idea?

That is a big risk.

The premise that I can't charge someone rent for my spare room in a property I own just seems stupid as a concept. Am I just misinterpreting what is allowed here?

Welcome to life a condo owner. You have to deal with the rules. They can limit what you can do.

Answer 2

A condominium unit includes the ownership rights to access the common areas. The point of this language is that it explicitly prevents you from leasing your private area of the condo to a tenant, while simultaneously not renting to your tenant access to common areas such as the hallways (you wouldn't do this) or amenities like a roof deck, storage room, etc (you might do this). Importantly, this language also prevents your board from restricting a common area amenity from tenants or making it owner-only.

You are able to lease the entire unit. Entire units are rented to groups of roommates regularly who organize roommate room assignments separate from the landlord. You might find being a joint landlord and roommate risky or what you describe as a "gentleman's agreement", and that's fair but it is available to you. The lease isn't going to be what keeps your roommate out of your room or using your TV.

A separate roommate agreement can establish who gets which room, share of utilities, chores, etc. so you can have a contractual agreement to not have your roommate use your room. It's just not in the lease.

Answer 3

Turns out in my specific case the condo is only 3 units large. Both myself and the other two owners want to be able to rent out single rooms. The language in the documents was boiler plate as the builder had just finished constructing the property. As we, the 3 owners, ARE the condo association for that condo we kind of make the rules. All of us are ok with rewriting (or not enforcing) that stipulation within the document. So we are all good!