Is your house too big for you and your need? What to do with extra space and rooms? If moving is not an option currently, then one of the solutions is renting out a spare room in your home. Why rent it, why not, what documents do you need, how to prepare, what to prepare? There are too many questions before deciding to make this big step. A guide will definitely help.
Benefits of renting out a spare room
What are the good sides of renting out a spare space in your home and why you should do it?
- Extra income to your monthly budget. A lot of money can be saved when renting out a spare room.
- Having another pair of hands in the house is helpful, especially if your tenant has DIY skills with home remodeling. She/he may do it in exchange for discounted rent.
- It is not only about money and incomings, but companionship is also important. If you feel lonely or you want to socialize more, this is a solution.
Disadvantages of renting out a spare room
Of course, everything has a bad and a good side. And, this is not an exemption, unfortunately.
- You will have more responsibilities as a landlord. Make an agreement with a tenant and protect yourself.
- Privacy may be a problem when you are not living alone. If you don’t want to share space, it is not a good idea to rent a room.
- It may take even a couple of months to find good tenant(s) you can trust. Don’t rent a room to anyone.
How to rent out a spare room – tips
If you decided to rent your spare room, then be prepared for a new tenant. By preparing we include legal stuff and decorating and remodeling the room you will rent. If you are a landlord for the first time, you should get some professional help, for example, a real estate agent and a lawyer to help you with the agreement between you and your tenant. The last thing you want is to be scammed.
Check local laws and rules
Each city in the US has different (or similar) laws, rules, and regulations about renting out a spare space in a home. Not only you should transform unused space in your house and make is safe for tenants, but also you need to fulfill some required tasks. The best way to know what and how is to check local laws and to ask professional. For example, tenants must have access to operational plumbing and clean running water or to have outdoor access.
Go to an insurance agency
Insurance is different for landlords because there are more chances for property damages. Landlord’s insurance is more expensive too for about 18%, so to get all the right information and the right insurance policy, talk to your insurance agent and ask for advice. Of course, you should do it after you are sure you can (legally) rent a room in your house.
Prepare your house
How to prepare your house for a new tenant? It is not enough to prepare a room. The entire home should be prepared. It is similar to preparing the house for a newborn baby. If you had kids, you know what that means. You should have keyed deadbolts on each bedroom door in your house, put all the valuables (such as jewelry) to a safe place, fix walls, or small kitchen appliances, etc. Both, you and your tenant must feel safe in the house.
Also, your house must be clean and decluttered if you want to host a tenant. Dirt will reject them. To make your house appropriate for a tenant, remove all the unnecessary items, and you should learn how to share. He/she will come with personal items, so make sure to make enough space. If you need help with packing or with packing supplies, Ample Moving NJ is one of the companies that may help you.
Decide which room you will rent
Some people choose the biggest room in the house to rent it out (to get more money), some people choose the smallest. It is up to you. Make a plan, which bathroom will be for the tenant, where will you sleep, etc? If you have more rooms than one to rent, you can also do it.
Pay extra attention to the rooms you will rent. Remove all your personal items and put them in boxes. Clean the bed, empty the closet, wash a carpet and windows, etc. To make sure your items are safe, get quality boxes to pack your stuff and protect them from damages.
How much to charge?
If you don’t know how much to charge your tenants for a room, check prices online. Don’t be too expensive or too cheap. Be realistic and don’t charge more than you should. Before putting your advertisement, set the price according to your ZIP code, size, and type of the room.
Be honest and specific
After decluttering your home, take photos and put the honest and a specific description on your ad. Can you tolerate smokers, are you a smoker, what about late parties, deposit, etc. All those important information should be on your ad. Don’t say “yes” just to rent a room quickly.
Make a rental agreement to secure yourself and the property you own. Protect yourself from scammers by using a WRITTEN agreement about renting. It should contain rent price, deposit, what about repairs, damages, who will pay for them, etc. Also, get to know a tenant before signing any agreements. When renting out a spare room, you are sharing your intimacy and privacy too. You can’t accept anyone.