If you want to make extra money from your home, renting out a room could be for you. It can help you chip away at your mortgage or fund that dream vacation. But sacrificing your solitude means you may have to adjust your lifestyle and set boundaries.
Understanding the pros and cons of putting up a room for rent will help you make the best choice that fits your daily life, meets your financial needs, and accommodates your potential tenant.
Key Takeaways
- Renting out a room can significantly reduce your housing costs or help pay off your mortgage, especially if you have unused space.
- While it’s generally legal, renting a room may require permits or compliance with HOA or city regulations, some areas even require inspections or exterior access.
- The biggest trade-offs include reduced privacy, potential property damage, and added landlord responsibilities like tenant screening and rent collection.
What Does It Mean to Rent a Room in Your House?
Renting out a room in your home can be a great way to earn extra income and make the most of unused space. Any room in your abode is fair game, from an unused bedroom to your home office. But regardless of which room you rent out, remember you will have to share common spaces, like the bathroom, kitchen, and even outdoor areas.
Renting out a room makes you both a landlord and housemate. You still need to take care of the normal landlord responsibilities but also have more interaction with your renter as you’ll be occupying the same property. Before you commit, be sure you’re ready to open your home and lifestyle to someone new.
Can You Rent Out a Room in Your House?
In general, it is legal for you to rent out a room in your home. However, various factors can impact your ability to do so.
For instance, a condominium homeowners association may prohibit additional tenants unless they are your family members. Even some municipalities have regulations to restrict you from renting a spare room in your home unless you have a license or permit. Some laws require a room to have a door to the outdoors or even a professional inspection.
Laws vary across the nation, so you will need to review the rules that govern your specific area, whether it be state, city, or even HOA. Staying in compliance with these regulations ensures you stay out of unnecessary and costly legal trouble.
Pros and Cons of Renting a Room in Your House
Renting out a spare room can be a boon, but it also comes with challenges. There are benefits and downsides you should know about if you want to make an informed decision.
Pros of Renting Out a Room
There are some perks to renting out a room in your house that can make the effort worth it.
Additional income and reduced housing costs
If you already have unused space in your home, you can rent it out and make some money instead of just letting it go unused. The money made from renting out your room is not just additional income but also a way to lower your housing costs, pay off your mortgage, and build savings. Don’t let that empty bedroom collect dust, put it to work and turn it into a steady income.
Tax breaks
Property owners may have access to unique tax deductions for renting out a room in their home. However, rules vary nationwide, so research your local laws to determine which regulations apply to you.
Experience being a landlord
Renting out a room is a low-risk way to learn the ropes of property management. You’ll handle leases, maintenance, and communication, all on a smaller scale. And if you enjoy it, you’ll be better prepared to invest in a full rental property down the road.
Cons of Renting Out a Room
Renting out a room isn’t without challenges, and understanding the potential drawbacks can help you decide if it’s the right move.
Property damage
Whether you’re renting out a spare room or the entire home, there is always the chance your renter may damage your property. Situations like this are never fun and can be costly to fix. Whether they scuff the walls or scratch your newly polished hardwood floors, you will need to prepare yourself for these possibilities.
Less privacy
Sharing your home with a renter means sacrificing some personal space. You’ll have to adjust to another person’s schedule, habits, and guests, which can make it harder to relax in your own home. If privacy is important to you, renting out a room may not be the best fit.
Additional work
Even a single room takes real work to manage. You’ll still handle listing, screening tenants, collecting rent, and keeping the space in shape. Renting out part of your home may be smaller-scale, but the responsibilities are the same.
Higher tenant turnover rate
A higher tenant turnover rate is not a guarantee, but often renters look for rooms for rent as a short-term solution to save money or while looking for a more permanent place to live.
Rent Your Room on Apartments.com
Listing your room on Apartments.com is an easy way to earn extra income and reach renters searching for rooms for rent in your area. All it takes is checking one box then following the usual steps to listing a property. Whether you’re renting out a room or an entire property, Apartments.com is here to help you every step of the way — from listing to leasing.
FAQ
Can you rent out a spare room in a single-family home?
If you live in a single-family home with your tenant, it is usually acceptable for you to rent out a spare room. However, if it is a non-owner-occupied single-family home, you should check your local laws to see if you can rent out individual rooms. Some municipalities restrict how many people can occupy a home, or they may require you to register your property as a boarding house.
Can I rent a spare room to a friend?
You can rent out a spare room in your house to a friend, but you should probably set clear boundaries. You want to preserve the friendship while still letting your friend-renter know you have house rules they must follow. Finding the balance in fulfilling your role as their landlord and friend is ideal for a harmonious personal and business relationship.
This article was originally published on May 17, 2022.
