How to Legally Start a Daycare in Your Apartment

Opening a daycare in your apartment can be very helpful to your family, your friends, and your neighbors.  This allows you to be apart of the developmental and educational skills for the children in your care.  Your family and friends can have the satisfaction of knowing that their child(ren) is with someone they already know and trust.

You can legally start a daycare in your apartment by incorporating the following things.  First and foremost, you must get permission from your landlord.  Secondly, you need to make sure that you are in compliance with your state regulations.  Thirdly, you want to make sure that you have business liability insurance.

You will want to make sure that you cover all your basis as you begin your journey of opening your daycare.  It is very important that you review all your documents and have a sit down with your landlord before beginning any of the processes for your new service.

How to Legally Start a Daycare in Your Apartment

Landlord’s Permission

First, you will want to review your rental agreement.  Sometimes landlords will put a clause that states they prohibit any type of business to run out of their apartment complex.  This clause is usually in the rental agreement because landlords expect the property to be used for residential purposes only.

There may also be a noise clause in your rental agreement.  You will want to make sure that you have a plan in place to keep the noise down to a minimum.  This will please your landlord and your fellow neighbors in the complex because you will be complying with the noise clause and will be doing what is necessary to not disturb your surrounding neighbors.

Secondly, call your landlord and set up a meeting. Let your landlord in on the full business plan so that he or she can understand your service you are providing to the public.  Keep in mind that some landlords may not understand why you are hosting this service in your apartment.  Landlords do not always understand why you just do not send your child(ren) to a daycare center.

In this meeting, you will want to hit on certain hot points that will be a huge deal for the landlord.  These hot points include, how many children you are going to be caring for and how often they will be at the apartment. Also, your landlord will want to know how many children you will have in the apartment at one time.

Allowing your landlord to understand your business will show him that you will be able to have a stable income.  This will benefit you because you are receiving the income that you need from current clients.  Also, this will grant you referrals later on down the line to keep the daycare flowing with children and income.

Your daycare will benefit the landlord because you will most likely have a stable income.  Another benefit to your landlord is that with the increase of traffic in the apartment complex, it will help him or her to fill any vacancies that might be in the apartment complex. Vacancies can possibly be filled by your customers or by people that are referred to the complex by your customers.

State Regulations 

Once you have received your landlord’s permission, you can now move on to the next step to opening your daycare.  Opening a daycare business in your apartment or home is sometimes referred to as “Family, Friends, and Neighbor Care.”  These types of daycares are typically exempt from licensing and regulations.

However, you will want to get with your local state licensing agency.  Exemptions depend on your specific state rules. This also depends on the number of children you plan to have in your care.  You will want to give the state the exact number of children you plan to have in your care.  This will also depend on whether or not they are related to you.  If you have a children,  you can count them as children you care for each day.

Do not forget that there is a teacher to child ratio in each state.  Depending on the state that you live in, you may be required to hire additional help in order to care for all the children that you will have in your apartment.

Most states require a criminal background check as well on all adults living in the house/apartment where the daycare will be held.  This will also be true for any and all staff members you may need to hire to make sure that all the children are cared for.

Most daycares are required to meet health, safety, and training standards.  You may also be exempt from these particular standards which you can find out from your licensing agency.  Even if you are not required to meet these standards, parents are more likely to leave their child(ren) with someone who can show they are capable of keeping their child safe.  As a daycare provider, you may want to know basic first aid and have CPR training.

You will also want to review your state regulations about the requirements you will need to have when it comes to education and developmental skills. Even though you will be conducting your daycare in your apartment, you will still want to be in compliance with your state’s educational regulations.

Inspection reports are required by most states.  Your inspection report will not only be for the safety of you and the children you care for each day.  It will also provide great aid to the landlord of any things that may need to be done to make his property more valuable.

How to Legally Start a Daycare in Your Apartment

Business Liability Insurance 

Business liability insurance is very important.  Even though you will have your inspection report from the state, you still need to make sure that you cover yourself in the event of an injury of a child or any damage done to the property.

Opening a business means that you are taking risk of children getting hurt on the property.  Not only does the business liability insurance protect you if a child gets hurt, but also protects the landlord.

Business liability insurance will help you cover any injury claims that may arise.  This insurance will also help you cover any medical expenses. This is something that you would definitely want to have in the event of a child, parent or employee gets hurt on the premises.

In addition to your business liability insurance,  it will help cover damages that are made in the apartment at little or no cost to you.  When you have a business in your home, you are taking a risk of possible damages.

In order for your business liability insurance to cover those property damages,  you will need to add the landlord as an additional insured on your policy.

Did you know that business liability insurance is designed to protect your business’s financial interests?  As a business owner, you will want to make sure that no only is the property and the people on the premises are protected; but also any legal aspects that may occur.  Business liability insurance also will help cover any legal defense expenses if they arise.

According to Investopedia, business liability insurance also covers claims of false or misleading advertising, including libel, slander, and copyright infringement.

Think about business liability insurance like car insurance.  You do not plan for an accident to ever happen, but it always good to have coverage in the event something does happen.  You will definitely want to have a good conversation with your insurance agent to make sure you are completely covered for any disaster that can occur.

How to Legally Start a Daycare in Your Apartment


Are there any grants are funding programs that I can apply for to help my business get started?

There are some government funding programs. Before applying, you will want to ensure that you are in complete compliance with all of your state regulations.  You will want to get with your Small Business Administration counselor to help you know which grants, if any, are available for your business.

How will my daycare business benefit the other tenants in the apartment complex?

Your business will be beneficial to the surrounding tenants because you will now become a “neighborhood watch”.  Since there will be people in and out of your apartment, it will help keep the crime rate down making your area a safer environment for you, your neighbors, and your landlord. Having a safe neighborhood is a great perk for your landlord’s rental property.

How should I get my landlord involved with the inspection reports?

Be sure to go over these inspection reports with your landlord.  This will not only make the building safe for your daycare business but also benefit the landlord.  As the landlord makes renovations and enhances the safety measures of the complex, he will have the benefit of tenants wanting to stay longer in the establishment.  As well as possibly have an increase in the rent at renewals and for new tenants.

Please note: This blog post is for educational purposes only and does not constitute legal advice. Please consult a legal expert to address your specific needs.

Looking to open your apartment Daycare, get started, with our startup course and documents here.

How to Legally Start a Daycare in Your Apartment

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