Earn money by renting out a room

So many people complain about the costs of their home (be it mortgage or rent). If you have a spare room or two in your house you are essentially allowing the value of the property to go to waste so it might be a good idea to consider getting a lodger. It is a relatively easy and very tax efficient option to raise some extra funds. With websites like easyroomate it has never been easier to get a lodger and earn some extra cash. 

The UK government currently has a "rent a room" scheme which means you can earn up to £4250 a year from rent tax free. * This is now £7,500 tax free earning from renting a room*. 
All you need to do is to opt into the scheme when you fill out your tax return. This means you have the chance to have a tax free side hustle. Though for this scheme to apply you must provide a furnished room. It is important to note that you must inform you mortgage provider (though they are usually fine with you having a lodger) and if your a tenant (private and local authority) check your contract and notify your landlord. 

What to consider when taking on a lodger:

Who the lodger is.
It is often best to pick someone who you already know, no matter how slightly (it could be just a friend of a friend). This is because a lodger is generally going to act better is there is something else to loose beyond just annoying the landlord. If you don't know anyone in need consider opting for an organisation to chose the lodger for example I know many university students who have used easyroomate with much success. However, regardless of how you find your lodger all ways meet up with them before you allow them to move in and if possible talk to former landlords or housemates.

- Will you provide meals / cleaning services. 
You may wish to include (and charge for these services), though be aware that this may make a lot more work for you. With regards to meals be sure that the lodger is willing to work with your meal times. The advantage as a landlord is that it prevents your lodger gaining a tenancy and reduces the legal rights that they have.

How much rent will you charge
It can be hard to know what is a fair market price, I would recommend looking at sites such as easyroomate to give you an idea of how much rooms are being listed for in your area. By doing this you are able to stay competitive in your pricing. Remember to review you pricing every year or so to ensure you are still charging market rent. 

Will rent be inclusive of bills.
This can be a tricky one as its hard to know what a lodgers consumption is which means you could be left short if you include bills. However, the advantage of bill included is you don't have to go chasing the lodger when bills are due especially if they are annual/bi-annual and the lodger has moved out by that time. 

Set out some house rules. 
At the end of the day it is still your home and your rules apply. Try not to be dictatorial, but some rules are okay. 
Think about things such as:
- energy saving (i.e. turn lights off when not in room)
- reasonable curfew (i.e not coming back at 4am and waking everyone up) 
- Is the lodger allowed friends over if so how often and until what time

Draft up a list of house rules when the lodger moves in and discuss them with the lodger on the move in day, giving them the opportunity for discussion. A two way conversation will lead to a much better dynamic between you and your lodger. 

If you are looking for a lodger easyroomate.co.uk is a great website and is the UK's number one roommate site. Best of all it is FREE to advertise your room meaning more money for you. 

Have you ever taken on a lodger? What was your experience like?

______________________________________________________

This post contains affiliate links.

If you are new to our blog, we are all about finding new ways for students and millennials to make and save money. Here are some of our favourite sites and products to help you out:

• Start a blog. Blogging is our side-hustle just over a year ago we didn't think I would bring us any income . You can create your own blog here with my easy-to-use tutorial. You can start your blog for as low as $3.49 per month plus you get a free domain if you sign-up through my tutorial.
• Save money with gift cards Whether its for buying clothes, your weekly shop or dining out use Zeek to buy discounted gift cards to get more bang for your buck. 
• Use Swagbucks for your online searches. Swagbucks is a passive way to earn gift cards. Over the course of a year you could earn $500.  Swagbucks is just like using Google to do your online searches, except you get rewarded “points called SB” for the things you do through their website. Then, when you have enough Swagbucks, you can redeem them for cash, gift cards, and more. Receive $5 for signing up today.
• Try matched betting. Matched betting is a great way to may easy money online. Despite the name it is not gambling and could see you earn £500-£1000 a month for only a couple of hours work a day see here and here. For your free trial head to profit accumulator or join the Facebook 'getting started' group.  
• Sign up for a cashback site like Quidco. where you can earn CASH BACK for just spending like how you normally would online. The service is free too! Plus, when you sign up through my link, you also receive a free £10 bonus!

*This post contains affiliate links, all opinions are our own*