An Easy Way to Make Extra Money - Rent Out a Spare Room
An Easy Way to Make Extra Money - Rent Out a Spare Room
As the UK slowly pulls itself out of recession, many householders may find that they are still feeling the pinch financially. Those struggling to make ends meet may want to consider an increasingly popular way of raising extra monthly income - renting out a room to a student or young professional.
In the past year or so, there has been an increasing trend by homeowners to rent out a room in their home and take on a lodger. Recent research by Santander (previously known as Abbey) has revealed that the number of homeowners that are now renting out a spare room has risen dramatically in the past year - climbing from 388,000 to 981,000. According to the bank, that means that around 3% of all homeowners in the UK have at least one lodger.
Certainly taking in a lodger can help recession-strapped homeowners, as the average weekly rent charged for a room is around £90. This equates to more than £4,600 a year, just from letting your spare room out. Plus, rental rate could be much higher, depending on where in the country you live.
Before you rent your room here a few points you should bear in mind
• Check your mortgage to see if renting a spare room is allowed. You may need to write to your mortgage holder to let them know. Also contact your home insurer to let them know about your plans and find out if you need to amend your policy. Finally, you need to make sure that your home meets all the safety regulations - be it gas appliances checks or fitting fire alarms.
• Make sure you understand the legal and financial implications of renting a spare room out. As an owner-occupier, you do not have to register as a landlord. Homeowners can make up to £4,250 per year tax free if they rent out a fully furnished spare room under the Rent a Room Scheme.
• You will need to work out in advance how utilities and other shared expenses will be shared. You will also need to agree whether overnight visitors are allowed, as well as whether you want to welcome them into your home as part of the household or for your each to keep to yourselves.
• It is not considered to be tenancy if you share your home with a lodger as an owner-occupier, so your lodger will not be entitled to many of the statutory protection given to tenants. To avoid possible misunderstandings, it is best to use a written contract stating what is allowed and what isn't.
• You will also need to make the spare room as attractive as possible to any potential lodger. Be sure that anything of yours (except the furniture) is out of the spare room, as the lodger will want to feel that this is his or her private space.
• Before you start looking for a lodger you should decide what type of person you would prefer, be it a non-smoker, a female or a student. The later has the advantage of only needing accommodation during term time. It may be a good idea to ask for some references, and do a thorough check on your potential lodger.
• Also research how much rent people are charging in your area for a spare room. There can be a big difference in prices between regions across the UK, with London being the highest.
Finding the right lodger
When it comes to advertising your spare room of rent you have a few choices. You could place a local ad to advertise your spare room to perspective tenants. Or you may want to take advantage of a specialist online property website, such as u-rooms.com. It is a dedicated online portal which links landlords and tenants, as well as those looking to rent out a spare room and lodgers. If you have a bit of spare room in your home and are looking for a lodger, let u-rooms.com help. With its fast, efficient and low cost service you will be able to find the right lodger in no time.
In the past year or so, there has been an increasing trend by homeowners to rent out a room in their home and take on a lodger. Recent research by Santander (previously known as Abbey) has revealed that the number of homeowners that are now renting out a spare room has risen dramatically in the past year - climbing from 388,000 to 981,000. According to the bank, that means that around 3% of all homeowners in the UK have at least one lodger.
Certainly taking in a lodger can help recession-strapped homeowners, as the average weekly rent charged for a room is around £90. This equates to more than £4,600 a year, just from letting your spare room out. Plus, rental rate could be much higher, depending on where in the country you live.
Before you rent your room here a few points you should bear in mind
• Check your mortgage to see if renting a spare room is allowed. You may need to write to your mortgage holder to let them know. Also contact your home insurer to let them know about your plans and find out if you need to amend your policy. Finally, you need to make sure that your home meets all the safety regulations - be it gas appliances checks or fitting fire alarms.
• Make sure you understand the legal and financial implications of renting a spare room out. As an owner-occupier, you do not have to register as a landlord. Homeowners can make up to £4,250 per year tax free if they rent out a fully furnished spare room under the Rent a Room Scheme.
• You will need to work out in advance how utilities and other shared expenses will be shared. You will also need to agree whether overnight visitors are allowed, as well as whether you want to welcome them into your home as part of the household or for your each to keep to yourselves.
• It is not considered to be tenancy if you share your home with a lodger as an owner-occupier, so your lodger will not be entitled to many of the statutory protection given to tenants. To avoid possible misunderstandings, it is best to use a written contract stating what is allowed and what isn't.
• You will also need to make the spare room as attractive as possible to any potential lodger. Be sure that anything of yours (except the furniture) is out of the spare room, as the lodger will want to feel that this is his or her private space.
• Before you start looking for a lodger you should decide what type of person you would prefer, be it a non-smoker, a female or a student. The later has the advantage of only needing accommodation during term time. It may be a good idea to ask for some references, and do a thorough check on your potential lodger.
• Also research how much rent people are charging in your area for a spare room. There can be a big difference in prices between regions across the UK, with London being the highest.
Finding the right lodger
When it comes to advertising your spare room of rent you have a few choices. You could place a local ad to advertise your spare room to perspective tenants. Or you may want to take advantage of a specialist online property website, such as u-rooms.com. It is a dedicated online portal which links landlords and tenants, as well as those looking to rent out a spare room and lodgers. If you have a bit of spare room in your home and are looking for a lodger, let u-rooms.com help. With its fast, efficient and low cost service you will be able to find the right lodger in no time.
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