Rental Income: Making the Most of your Home

If things are getting tight with the mortgage rates these days, think about generating some extra income from your own home. Renting your own home (or part of it) is something that more of us should be considering. The conversion I will describe is easiest with a basement home.

There is a plus to giving up a couple of rooms in this way – houses with in-law suites will soon be in big demand as the baby boomers grow old!

Renting is good business sense and it is not the black area that many of us think it is. In fact, once you have tried it and realized how much stress it can relieve, you will probably be hooked!

But, if you try it without following some simple rules it could be a nightmare because you do need to have all your own family needs looked after. Here are some ways to foolproof yourself so that you can enjoy renting your home and having a boost to your income.

Do not consider renting without first having a separate entrance for the tenants. Many homes have this already, or you may have to give up your back door, or build yourself (or the new suite) a new back door. The cost of doing this will be realized in only a couple of months rent.

There will probably be small initial outlays: a door between your living accommodation and their rooms or suite. It is very simple to hang a door or make an interior wall with a door. It can also be easily removed if you wish to rent for only a few years.

If your home has a downstairs bathroom, you will have to give this up, unless you are happy with a shared situation. Beware of sharing as it may mean that your part of the home is accessible.

You do not need a full size stove, these days a microwave, a broiler oven and a small bar-sized sink will be sufficient.

Think about the car parking situation and ensure that it can be adequately solved. (i.e. one car of theirs in the driveway, one on the street?)
Do not share your garden as most purpose built apartments do not have this luxury, and you need your privacy. Remember gardens come right up to windows!!

Now that we have dealt with the physical characteristics of the house, we turn to you and your family. The single most important aspect for being a happy landlord is this: make sure the tenants have the same lifestyle as you. This may sound odd, so let me explain.

If you have a young family and the kids are racing around the house by 7 in the morning, you do not want a night-duty nurse downstairs trying to sleep! Alternatively, if like to be in bed with everything locked up and lights off at 10.30.p.m., you do not want a tenant who plays rap until 2.a.m. and then orders in a pizza. A quick solution to this is only request a career or professional couple.

If you like your home to look a certain way (e.g. all the drapes to remain in place, or no bikes outside, or no garbage bags by the door) then make sure you have these pointers written into an agreement, along with the hours about the noise and bedtime.

It is easier to remain detached and keep your privacy if you are not involved in any of the rental processes. Using the services of a rental company ensures that the legal aspects are all adhered to and allows you to maintain a strictly business-like attitude with your tenants. e.g. good morning and good evening if you pass in the driveway.

Do not become involved with the choosing process, the interviewing, the eliminating of unsuitable and the checking of references.

Do not be the person who deals with any queries or complaints.

Do not be the person who collects rent, gives notice etc

Just be the person who has a bank balance that expands every month without you lifting a finger!