So you’re thinking of renting out a room in your house to earn extra cash. However, opening up your home to a stranger is a different story than taking in a tenant for a separate investment property.
Here are eight tips make sure that renting out a room in your house is a success:
1. Ready your home:
Obviously, if you had visitors coming over you would prepare your home for them. It is the same with a boarder. You should organise and declutter your house. Repair things that need fixing. Install security systems like Smart locks or even a CCTV to ensure safety.
2. Decide what room to rent out:
Does your master bedroom have its own bathroom? You might want to consider moving out of your master bedroom and moving into a smaller room. This can provide more privacy for you and your renter, and it can also guarantee more cash flow.
3. Advertise your spare bedroom:
You will need to advertise that you’re renting out a spare room in your house. Make sure that photos are attractive, the ad listing is clear, and that your rental rate is appropriate for the room you have and its location. You can place ads on websites like Facebook room for rent groups or in GumTree.
4. Background check the renter:
As a landlord, you want a boarder who can consistently pay the rent and one who is trustworthy. It’s imperative that you interview them in person, know their credit history, and check their references. You can even check out their social media accounts to get a feel for them as a person. Get to know them and see if they fit your requirements.
5. Set out rules and guidelines around the house:
The boarder will be living with you in your house. So it makes sense to set up rules and guidelines regarding living arrangements. This will ensure that there’s still privacy and security around the house. Discuss with them the rules even before giving out the rental agreement, so the renter will know what to expect if they decide to rent out a room.
6. Don’t forget to provide a written rental agreement:
A written agreement is vital when you decide to turn your spare room into an investment property. Don’t forget to include things like:
- The cost of rent
- The payment date
- The arrangements regarding utility (water, electricity, internet) bills
- The general house rules
7. Know your landlord rights and responsibilities
Even though you’re only renting out a room in your house, it’s still considered an investment property so there are things to keep in mind such as getting the appropriate insurance, and knowing your legal obligations and rights.
Once everything is properly set up with your investment property, you will see that the money will start rolling in. Plus, the rent money will cover part of your monthly mortgage payments!