Working From Home Could Soon Cost You an Extra $200 a Month

A rental listing in Walnut Creek, CA, has sparked outrage amongst renters—thanks to its $200 monthly fee for tenants who work from home. 

In an already suffocating housing market where tenants feel stretched to the brink, this particular landlord is charging $3,250 monthly rent (which reportedly covers utilities and Wi-Fi), then tacking on the $200 penalty for remote workers on the property.  

“That’s crazy,” renter Samara Wondimu told ABC7, with another renter, Cody Hall, calling the whole concept “ridiculous.”

Yet, while renters are livid over these work-from-home penalties, corporate housing advocates are defending them. 

“It’s almost like a utility cost recovery or environmental conservation fee,” Derek Barnes, CEO of the East Bay Rental Housing Association, explained to ABC7. 

For renters desperate to find a good deal, spotting these hidden fees before signing a lease is critical, and knowing your rights if you absolutely need to work remotely is equally important.

The rationale behind these fees and where they occur

As rent continues to rise, many jurisdictions have implemented rent increase caps. 

“Landlords have attempted to circumvent rent cap laws with work-from-home fees,” says Jessica Bober, legal expert at JustAnswer and owner of Bober Law Group, PA. in Tampa, FL. 

These fees have also been tacked on to monthly rent to account for the additional cost of utilities by remote workers. 

“More electricity, water, and internet are consumed daily when tenants don’t leave their homes for an office,” Bober explains.

According to Bober, these fees are particularly popular in states such as California, New York, Texas, Colorado, and Virginia with large tech hubs.

Whether they’re enforced depends on the landlord.

“Sometimes, your work-from-home status may be revealed by the income disclosures you provide with your lease application. Some landlords may ask you directly whether you work from home and count on your honesty” says James Dodge, a professor of law at Purdue Global Law School based in Los Angeles.

Other times, your work activities that generate noise, foot traffic, and neighbor complaints allow landlords to discover your remote work status.

In some states, however, laws are making it harder for landlords to tack on these fees without being transparent and upfront about them.

“California requires landlords to include any required fees into the advertised monthly rent rate. This provides full disclosure of the monthly costs. Tenants also have the right to decline or refuse being included in bundled utility services,” says Bober.

Bober points out that just this year, Colorado introduced a new law regarding junk fees similar to the one in California. Landlords are required to disclose all fees plus monthly rent in the advertised price.

“If a lease is offered where the utilities are community-based and the tenant will not have their own account, then the tenant may demand written proof as to how the allocation between rental units is calculated. The most common way is based on the square footage of each unit,” explains Bober.

This type of transparency can help tenants determine whether utility costs are being fairly distributed among units or being increased based on whether someone works remotely. 

Barry E. Janay, president and managing attorney at The Law Office of Barry E. Janay, P.C. in Livingston, NJ, explains that in New York City, rent-stabilized units do not allow a landlord to collect anything above the legal regulated rent. Doing so exposes them to an overcharge claim with treble damages. 

“However, noncontrolled or stabilized leases (market rate) do not have the same protection. For them, some ancillary charges have been outlawed since 2019 and work-from-home fees were not one of them,” says Janay.

According to Dodge, there are no general federal protections that ban WFH fees.

However, federal fair housing protections may apply in certain circumstances, particularly when a tenant works from home due to a disability.

“Under the Fair Housing Act, a landlord can’t charge a tenant with a disability a special work-from-home fee if working from home is an approved medical accommodation under the Americans With Disabilities Act,” Dodge explains.

Still, there are potential ways around that.

“In practice, most landlords avoid this by requiring all of their tenants to pay work-from-home fees,” he adds.

Is a work-from-home fee cheaper than commuting?

If your landlord charges a monthly $200 WFH fee, that’s $2,400 per year. Before you decide that it’s not worth paying, however, think about what you might spend to commute to work.

The Commute Cost Calculator from Commute Solutions, for example, can allow you to estimate the monthly cost of your commute based on factors like your vehicle expenses and the distance to and from your job. If your commute costs exceed $200 per month, the WFH fee could actually save you money.

Let’s say you spend $300 per month on your work commute. That’s $3,600 per year—and will cost you $1,200 more than paying the WFH fee every month. In this case, it’s cheaper for you to pay the fee and work from home.

What to do if you’re a renter 

If you rent a home, it’s up to you to spot these WFH fees as they can be easily overlooked.

“The fee might be there if the property is advertised with ‘free’ or ‘included’ utilities. To double check, request an itemized list of all fees before you complete the rental application,” says Bober. 

Don’t forget to review the proposed lease for any provisions stating flat-rate utility instead of metered or individual usage, including language limiting the daytime use of appliances.

If you find that a rental does impose WFH fees, you might be able to reduce or even waive it altogether by simply negotiating with the landlord or property management company. 

According to Janay, the most effective negotiation tactics allow landlords to maximize rent and occupancy without having to make unnecessary repairs to their units. 

“The best way to negotiate is to convey you’re a low-maintenance tenant with a clean rental history. Proof of timely rent payments and letters of recommendation from previous landlords are great bargaining tools,” Bober explains.

Requesting a long-term lease is another solid strategy. 

“It can be costly to transfer the property from one tenant to another one. If you’re willing to sign a lease longer than 12 months, you may get a discount on the fees. However, the downside is you could be on the hook for early termination fees if you need to vacate early,” adds Bober.

In addition, if you’re able to pay the entire lease’s rent in one or two lump-sum payments, the landlord will likely be flexible with the fee. 

“They’ll get cash flow and get rid of the risk of you not paying. Pre-paying is a huge incentive for most landlords,” Bober says.