6 Ways to Make Extra Income Using Your Home
- Your house can be turned into a money machine.
- You can rent your whole house if you are away from home often.
- Renting a little-used space such as your garage or spare bedroom can generate year-round cash flow.
The United States inflation is at a 40-year high, and many economists forecast elevated prices may linger a while longer. Rather than finding the nearest blanket to hide under, re-assess your house and how you might use it to generate cash flow and build equity.
Viewing every square inch of your home and other high-value possessions as rent checks waiting to be cashed can be a great way to harness rising prices and earn income, especially should the much-talked-about recession move from possibility to reality.
Advantages of Turning Your House into a Money-maker
Money typically flows in only one direction when it comes to your primary residence— out the door in the form of utility bills, maintenance, and rent or mortgage payments. Renting out your home allows you to turn your home into a money magnet that can be used to pay off your mortgage. In addition, renting it out in small bite-sized portions—a couch here, a room there—provides the added advantage of letting you try your hand at property management.
Passion for People
If you are suited for screening tenants and interacting with guests, you can rent portions of your home for long stretches. However, if hosting is not your cup of tea, you can consider only renting when you’re out of town.
Dividing your home into rental zones or chunks also means you can rent different areas simultaneously, potentially doubling or tripling your income. For instance, if you have a great backyard and a spare room, each could be rented, even on the same day, as two separate rental spaces, thus allowing you to capture revenue from different audiences.
Two common websites where people can list portions of their homes for rent or host events are Airbnb and Peerspace.
Think Like an Investor
Lastly, by thinking about your home and possessions in terms of their rentability, you can make decisions through the lens of both an investor and a consumer. For example, if you are renting out your car during weekdays while you work from home, regular maintenance of your car becomes an investment and high-priority requirement rather than something to be put off indefinitely.
Recommended Read: 5 Ways to Make Extra Money With Your Car
The Downside of Renting Your Home
While there are upsides to renting your home, there are also downsides to consider.
Managing Your Rental Space
One is the added complexity of managing multiple rental spaces. For instance, if your rental portfolio comprises your swimming pool, a finished basement, a spare bedroom, and a car that’s available on weekends, then the marketing, scheduling, upkeep, and overall management of these mini properties can quickly overwhelm even the most organized manager.
Wear and Tear
If you like taking good care of your possessions, then the additional wear and tear on your possessions could be a big downside. It’s important to note that your property might not always be treated with the same care by your customers as they would by you.
Keeping Items in Great Condition
Finally, when they arrive, each customer will expect the item being rented—a spare bedroom, for instance—to be in pristine condition. The requirements of keeping your home in a perpetual state of move-in readiness will almost certainly add extra time, money, and stress.
Top Six Spaces to Rent Out in Your Home
Let’s take a closer look at potential money-maker opportunities in your home:
The Entire Home
Renting your whole house can be particularly lucrative if you’re away often. If work travel is part of your routine, renting out your home during these trips can be an easy way to add cash flow. Concerts and special events also offer opportunities to collect rent at a premium.
A Backyard Bash
If friends and family often remark on how lovely your yard is, this is your cue to open your secret garden to others. Family reunions, birthday parties, and weddings all offer the opportunity for extra income. To extend the use of your yard space during the spring and fall, consider providing heat lamps and tents for an additional fee.
The overnight rental of your couch is probably the easiest way to dip your toe into the property rental business. This opportunity tends to work best in expensive cities where the cost of even a shoebox-sized hotel room is sky-high.
Share Your Spare
Renting out a spare bedroom gives you the option to host a housemate without the obligation of having them bunk year-round, roommate-style. If your high school student is moving away from home in the months after graduation, consider renting out their room to supplement their tuition and cost of living expenses.
Recommended Read: The Ultimate Financial Checklist for Recent Graduates
Where you see a dusty old garage, someone else might see the perfect place to store their craft projects, collectible car, or bulky household furnishings. Unfortunately, in urban neighborhoods, ample storage spaces such as garages, sheds, and driveways are few and far between. Check the going rate of self-storage garages and parking lots to help set your prices.
Throw in the Car Keys
Your car, like your home, has money tucked in the glove compartment and hiding under the seats in the form of rental customers. Sharing your vehicle with others can put you on the fast track to paying off your car note and increasing savings for future property investments.
The Money Wrap-Up
Your home offers a potentially high-value and low-risk way to earn money while you sleep. Becoming a property investor by house-hacking your whole house or a space in your home can enable you to earn cash quickly. The extra income you generate can pay off your mortgage early or build your property investment nest egg.