Your home may well be your castle, but there’s no getting around the fact that it’s also a huge financial responsibility. However much you may be thrilled to be on the property ladder, especially when you consider the alternative in terms of sky high rents, you still need to manage your finances and live within your means. Sometimes, money’s just a little too tight for comfort. When you’re working all the hours but are still struggling to keep on top of mortgage payments and utility bills, how about getting your home to help out? There are various clever ways to generate a bit of extra income using the space in your home.
Renting out your spare room to a long-term lodger isn’t exactly a new idea, but it’s definitely worth thinking about. Obviously, it’s important to choose a respectable and trustworthy tenant but provided you’re happy to share your amenities and communal areas with another person, you may even enjoy the companionship and added security that having a lodger can bring.
The monthly rent payment (plus perhaps a contribution to your household bills) can go straight into your bank account and provide some extra income to bridge a budget shortfall. The good news is that you don’t need to pay tax on the first £7,500 per year that you earn in this way – that’s up to £625 per calendar month tax free! Check the government’s Rent a Room Scheme for details here.
Short term lets
If you’d rather not make a long-term commitment to rent out your spare room, there are plenty of short-term options that might work for you instead.
Airbnb and similar websites have really taken off in the last few years, allowing you to let spare rooms or even the entire flat or house on a very flexible basis, starting with 1-night stays, with or without breakfast.
You may even find that being a B&B host suits you down to the ground, in which case there’s nothing to stop you turning it into a potentially quite lucrative business on the side.
Another tip is to look out for any popular events taking place in your area and tap into the demand for visitor accommodation. Rent out your spare room for the duration of sports events or festivals nearby and pocket a handy extra income.
Private English language schools can be a useful source of extra income, particularly over the summer months. If you live in an area that’s popular with foreign language students, contact the schools direct to see if they’re looking for host families from May to September. Rates vary widely depending on where you are and how luxurious your accommodation is. £80-£120 per week is not an unreasonable expectation.
You’ll be asked to provide a study bedroom, breakfast, a packed lunch and dinner for students who will stay with you for one or two weeks or longer. In practice, most international language students have a packed programme of activities and you’re unlikely to see very much of them.
If your summer months are too precious to give up but you like the idea of student letting, how about becoming a ‘guardian’ host family for overseas students at UK boarding schools and colleges? These students need short-term accommodation for set half-term and weekend dates when their school is closed but they cannot return home abroad. Contact one of the many guardianship agencies in the UK to find out whether this could be for you.
Garages, drives and neighbourhood storage
If you don’t have a spare room or would rather not share your home with a stranger, you could consider making an extra income by renting out other spaces in your home.
Parking space is at a premium in most towns and cities, so if your car is away from home during the day or you don’t own one, someone else may well be interested in using your drive or garage. In fact, the closer to a mainline train station your home is, the more valuable these spaces will be to commuters.
Don’t underestimate the value of your unused rooms, basements, attic areas, garden sheds and even outdoor spaces. Often called ‘neighbourhood storage’, you’d be surprised how many people will be interested in renting extra storage space for anything from personal belongings to office archives to commercial goods to cars and vehicles! Check out Storemates or storenextdoor to see how you can register.
Film sets and photo shoots
For lucky owners of quirky, unique or top-of-the-range glamorous homes, a lot of money can be made by offering your property for film and photography location shoots.
Production companies tend to be based in the South East, making properties in London or the M25 area most sought after. The good news is that your home could fetch up to £2,500 per day for a major feature film.
However, be warned that the film crew will expect value for money – including full access to your home and the ability to change, redecorate and rearrange anything and everything! To register your home, visit Shootfactory, Location Partnership or contact the BBC’s location department for guidance.
For more ideas about managing your finance and credit see our main website.
Amanda Gillam is Solution Loans's General Manager and has been since 2009. She is also a prolific writer on personal finance issues, and has been quoted numerous times in articles published on 3rd party websites and in press releases. Her...Read more about Amanda Gillam