With the multitude of monthly expenses that we are responsible for, nothing feels better than earning a few extra dollars on the side. I personally love supplemental income and have been working on highlighting the different ways my readers can build a steady source of income leveraging their home as a money generating asset.
While I recently purchased a rental property to build a new ‘landlording’ business, this post is a DIY approach to a fantastic way anyone can generate a stream of income through the renting of a spare room in the home.
Renting out a spare room is perfect for empty nesters, families with larger homes, or even families looking to earn extra income while hanging out with fun people! The ‘Home-Rental’ sites like to advertise how easy it is to attract renters to your home, and I agree to an extent. The rental sites fail to explain all of the work it takes to set up the home for this project. Without proper preparation for such an endeavor, you may find yourself or your family at risk. Especially if you are planning on sharing your home with strangers, I suggest you take the time to properly list and prepare to the best of your ability.
Services for Renting Your Home or Spare Room:
· Short-term Rental sites such as AirBnB and HomeAway work fantastic for those living in a ‘vacation’ area. Most sites have great insurance policies and allow you to exchange messages with the prospective tenants before agreeing to a rental contract.
· Long-term rentals can be a little more difficult, but all of the major real estate sites, such as Trulia, Rent.com, and Zillow have some sort of protection for their users. I suggest staying away from Craigslist until you feel very comfortable with the way your rental unit is set up.
· Alternatively, consider hosting exchange students. Almost all local high schools and universities have exchange programs with foreign institutions. Here is a fantastic resource to read before committing to an exchange program. These programs are a great way to earn a few extra dollars, have your family experience different cultures, and even potentially cultivate life-long friendships. Most programs are also heavily vetted and will provide great insurance policies for the hosting families.
Cost Effective Landlord Tips:
Regardless of what service you use, I have put together a great DIY list to help prepare for the new renter. Following these tips will not only provide a cost effective way to rent a room, it will also keep everyone safe and cultivate an engaging setting that will culminate in a fantastic rental experience.
1. Prepare ‘The Space’. Before posting the spare room on any website, work hard to ‘beautify’ the space for both the listing photos and the upcoming renter:
o Buy soap, towels, laundry detergent, and other supplies in bulk. These amenities look fantastic in photos and can justify a slight increase in rent.
o Make cleaning easy. Add screens to windows to reduce outside ‘junk’ and purchase easy to use vacuums or brooms that can easily reach under the beds. The less time cleaning in between guests, the more you will prosper from your ‘cleaning fee’.
o Have a clear theme or ‘look’ to the space. Make sure the furniture matches the decorations; I like to use a throw rug to tie the room together. Sheets and blankets should match the room as well. If you are feeling extra special, you can add new paint to the walls.
o Use a duvet instead of sheets. A duvet can be easily washed, but a full comforter can get damaged or be expensive to wash. Using a duvet will also result in less laundry and this means less time spent during the ‘cleaning phase’, resulting in more money in your pocket.
o Set up a space in your kitchen for the guest’s ‘goods’. People like their own spaces and a note in the room description will be an added bonus amenity for your guests.
o Get coffee in bulk and offer it. This is especially true for short term guests as people love coffee and enjoy that fruitful ‘free stuff’ feeling.
2. Check Your Renters Out. This is one of the most important steps to take before officially renting the space. Be sure to keep your family safe. There are many services to use, but I personally use this resource from TransUnion as it provides information such as previous evictions that Airbnb or Home Away leave out. To take extra precautions, follow these tips:
o Ask for references and actually follow-up with them.
o Lock up expensive belongings in a safe when not at home.
o Have a lock on all bedroom doors. The privacy of your guest is just as important as your own privacy.
o Teach your children ‘the rules’ of interacting with strangers. In addition to being a safety precaution, this is a great learning opportunity to teach the difference between ‘friends’ and ‘strangers’ (if they don’t already know).
3. Provide Fun Activities. People often rent rooms instead of entire homes because they want interaction while on vacation. Hotels are fun, but they lack interpersonal connections. Your new rental space can be a perfect mixture of fun and privacy! Be sure to offer these activities without pressuring the guests to attend.
o Offer daily breakfast. I love this perk, but remember to account for the cooking supplies in you rent.
o If you have more than one room rented out for the long term, offer a potluck dinner once a month. It is always fun to see what people cook up for a shared dinner experience.
o Create a PDF of local attractions, transportation options, and other pertinent information regarding your neighborhood.
o Rent out your extra bicycle or car. If you are renting your car, make sure you call your insurance company first!
4. Review Guests Properly. This is important for the ‘search results’ on the rental website as well as information for future landlords. It is important to ‘pay it forward’ as the phrase goes:
o Provide accurate in-depth reviews. Don’t just write “My guest was great”. Provide examples of reasons why you enjoyed their presence. If the rental service asks for ways the guest can improve, be honest and avoid rude language.
o Bad reviews can hurt rental listings! Some services do not offer an ‘explanation’ section if a rental experience goes poorly. I always like to wait until my guest reviews me first and review back accordingly.
o Offer to become a future reference for your renters. I suggest mentioning this as they give back the keys. It may prompt a great review of your space!
Finally, if renting out rooms is not an option, there is another way to leverage your home. I love the following idea:
1. Leverage the Backyard into a ‘Community Garden’.
In my experience, almost everyone loves to garden. However not everyone has the physical space for such a stress reducing activity. After you build a few raised garden beds you can rent them out to aspiring gardeners. Consider these tips to get started:
o Reach out to local garden communities and post a listing for a private garden space.
o Supply the dirt, water, and tools for a nominal fee.
o Keep the price low to start and as you build a reputation the rent can increase.
o You can even start a website about your new garden community, write articles, gain sponsors, and earn supplemental income this way.
Now you should have all of the tools needed to rent out an extra room in your house and start earning some much deserved supplemental income. If you need help writing a great rental advertisement, check out this resource. I want to give a big shout out to Parentwin for the guest blogging opportunity!
Author Bio: Hank is an aspiring DIY and Home industry blogger. He loves everything about the home and garden and enjoys the smell of fresh cut grass. Check him out on Twitter and see what he is up to next! @homebyhank