Rent by the Room: Unrelated-Tenant Limits

Before you rent a house room by room, find out two things: whether your city may cap the number of unrelated people living together, and whether a house shared by the room is a "rooming house" that needs a licence.

Coliving and rent-by-the-room hosts run into local rules that apartment landlords rarely see. Several states have now stopped cities from capping unrelated occupants; some cities still license rooming houses. Here is what we found, with the citations.

Not legal advice. Zoning and licensing are local; confirm with your city before you lease rooms.

States that stop cities from capping unrelated occupants

State	Rule	Citation
Oregon	No local government may set or enforce a maximum occupancy based on familial or nonfamilial relationships among the occupants	ORS 90.112 (HB 2583, 2021)
Iowa	Since January 1, 2018, a city may not regulate occupancy of residential rental property based on familial or nonfamilial relationships	Iowa Code § 414.1(1)(b)
Colorado	Since July 1, 2024, local governments may not limit how many people live together based on familial relationship; only health-and-safety standards and affordable-housing guidelines may set limits	C.R.S. § 29-20-111(3) (HB24-1007)
Washington	Cities, code cities and counties may not cap unrelated occupants; co-living housing must be allowed on any lot in an urban growth area that allows at least six multifamily units	RCW 35.21.682, 35A.21.314, 36.01.227; RCW 36.70A.535

Texas: college towns only

Since September 1, 2025, a home-rule city of under 250,000 people that hosts or adjoins a campus of more than 20,000 students may not cap occupants by age, familial status, occupation, relationship status or relatedness. It may cap only at one occupant per 70 sq ft of sleeping room plus one per additional 50 sq ft, or under building, fire or health codes (Tex. Loc. Gov't Code §§ 211.051–211.057, SB 1567). Other Texas cities are outside that subchapter.

Cities and states that license rooming houses

Philadelphia. Four or more unrelated people sharing a dwelling is a rooming house, so at most three before that regime applies. A rooming house needs an L&I Rental License, and the application must show the use is legal: a Certificate of Occupancy, or for a use established before 2000, a Zoning Permit plus an Affidavit of Continuous Use (Phila. Code § 9-3902; L&I Rental License Regulations § 1).
New Jersey. The Department of Community Affairs licenses rooming and boarding houses in six classes, A–F, with an annual fee of $333–$666 (N.J.S.A. 55:13B-1 et seq.; N.J.A.C. 5:27-1.6). Check whether your house meets the definition.
Atlanta. In the R-2 single-family district a building "shall be used only for" the listed uses, and rooming houses are not among them — neither permitted, accessory nor special-permit uses (Atlanta Code Secs. 16-04.003 to 16-04.005). They are a special-use-permit use in some other districts. Confirm the parcel's zoning before renting by the room.

Where Proprietio fits

Coliving and rent-by-the-room software bills each room on its own agreement, weekly or monthly, splits utilities onto each member's bill and keeps house rules e-signed. Set your city's occupant cap on each house and it warns you when a house holds more members than the cap.

Sources

ORS 90.112: oregonlegislature.gov
Iowa Code § 414.1: legis.iowa.gov
Colorado HB24-1007: leg.colorado.gov
RCW 36.70A.535: app.leg.wa.gov
Tex. Loc. Gov't Code ch. 211: statutes.capitol.texas.gov
Philadelphia L&I rental licence: phila.gov
N.J.A.C. 5:27: nj.gov
Atlanta Code of Ordinances, Part 16: library.municode.com

Read on 2026-10-20.

Informational, not legal advice. Statute citations and procedural rules vary by state and change frequently — verify the current text and any local ordinances against an official source, and consult a licensed attorney for specific situations.