If you need to earn extra income and have a guest room or guest space on your property, and it is not being used regularly, you should consider renting the space for a great passive income. This type of space rental has become a popular alternative that vacationers or those traveling for business are taking instead of getting a hotel room. Renting a room with access to a shared kitchen, living spaces, and sometimes a yard or pool can be a more relaxing way to spend time away from home for travelers.
Unused spaces that could be used for this type of room rental could be a guest room or a suite of rooms if you have more space. This space could also be a converted attic, basement, or garage as long as it is a comfortable living space. It could also be a guest cottage or over the garage apartment. These spaces are furnished and not the same as taking on a full roommate who would pay their share of expenses and be a part of the mortgage or lease. This space in your home should be similar to a bed and breakfast though breakfast is not mandatory.
Spread the Word
You can use your social media platforms and the word of mouth of friends and family to help get the word out about your rental space. There are also several websites specifically dedicated to this type of space rental. You can include information about the property, what is and is not allowed, and the price per night. You can also include pictures of the space to entice potential customers further to rent your space. Though you could do it directly through ad sites like Craigslist or word of mouth, it is recommended you use these rental websites as they are designed to protect both users.
Safety and financial protection need to be the focus of this type of rental. If you do not use a website with built-in protections, you should consider the following to be on the contract.
- The amount and when it is needed to be paid
- The advance payment (if there is any)
- The move in and move out dates
- What is included with the rental fee
- Pet agreements if pets are allowed
- Any additional house rules the landlord wants to be noted
Setting the Price
When setting the price, you must look in the market in your area and set your prices comparable to what is being charged for similar rentals. If you don’t have comps in your area, you can look in other areas to get an idea. Also, you need to factor in what you need to make for it to be profitable. Even if it is slightly higher than the market, you need to profit; otherwise, why have the rental?
Rental and Homeowners Insurance
Rental insurance is compulsory if any damage occurs, such as rain, flood, fire, etc. You must contact your homeowner’s insurance company and ensure that your insurance will cover it if something happens to the patron while they are on your property. If not, you need to find out what you need to add to cover you and your property against liability. Renters insurance may also be a possibility; however, you need to factor the insurance cost into the price you set for the room per night.
Renting out space in your home for extra income can be profitable, but it will take some work, safety measures, and financial protections on your part as the landlord. You should only consider this endeavor if you can profit and if you really like people because you will be interacting with strangers in your home.About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.