Have you heard – the government has increased the amount you can earn form renting a room in your house before being taxed from £4,250 to £7,500! That’s £625 extra a month you could earn by having a lodger!
In the past my husband and I discussed having a lodger but he was quite against it so we decided not to. However my brother came to live with us and wanted to pay us rent. We agreed on a fair amount and he has been here since December. One of my friends took in a lodger when she split up with her partner and needed some extra money coming in. She has a little girl but it has worked well for them. Once my brother has paid off his debt and saved up a bit, I will increase his rent payment.
The extra money has been incredibly helpful to have. It is paying for my car insurance and paying off debt. It’s great that it’s a family member because that doesn’t make it awkward etc. Don’t get me wrong though it’s not all fun and games but it’s definitely worth the extra money and I’m actually dreading him moving out! I am going to keep him here as long as I can, haha.
- The room has to be furnished. If your spare room doesn’t have any furniture it’s really easy to find furniture for free on sites such as Gumtree. Ask family and friends if they have any furniture/un-used bedding etc that they just want to get rid of and can pass to you
- Speak to your mortgage provider to see if they are ok with it, check if it will affect your benefits, council tax, contents insurance. Let all of these companies know.
- Decide on how long you want a lodger in your home – you could always just have a lodger for a 6 month contract for example and then not rent out again if you don’t want/if your debt etc is paid off! Some rooms are only rented out during the week for commuters – so you would have the house to yourself on the weekends. It’s all about what is best for you.
- Write up a written agreement between yourself and the lodger. Think of any terms you want them to adhere to. Do some research into it or speak to someone who has had lodgers before to get their input. This could relate to the rent payments, damage, notice of leaving etc.
- Check out the different sites you can do this through and the pros and cons of each. For example Airbnb and Wimdu vet the renters for you. You do have to pay them a fee though (I think it’s 3%). Other sites such as Gumtree would be free to advertise but you would not get the checks done. For longer term renters there are sites such as SpareRoom and EasyRoomMate. Please note I haven’t tried any of these out so can’t personally recommend any.
- The most important thing is rent. Make sure you get this in advance and make sure the tenant knows they have a certain amount of time to pay any late payments before they are asked to leave. You could also include council tax, water etc in this price.
- Ask around and see if anyone you know is interested. Unless you ask you don’t know! One of your friends children could need somewhere or someone trustworthy that they know. This will save you on advertising.
- Look online at other rentals in your area (just type in ‘room to rent in…’) and see how much they are charging so you don’t under or overcharge.
- Think of any extra costs before. For example getting a lock on your bedroom door, increases in utility bills.
- Even if you rent it out for a month or so, that’s still extra money for you. I am really enjoying having extra money coming in because it means less money stress for me!
Does anyone else have a lodger or is thinking about having one? Any tips?