How much can you expect renting a room in your house?
According to Airbnb.com, a website that allows you to rent your extra room to travelers, the AVERAGE earning of people renting through them in NYC is $21,000 a year. Wow. On average of about 10,000 people.
What would you do with an extra $21,000 every year, just like that?
(check out my article about Airbnb hosting tips if you decide to put your room on the market!)
More important, what would you be ready to give up so you can put your hands on the cash?
Privacy? Having to do extra batches of bedsheets laundry? A bit more cleaning?
How much you can earn by renting an extra room depends on a lot of factors, but the first one on the list is how desirable your location is.
Do you have a college nearby? Or a big company offering a lot of entry-level jobs? How close are you from a big city? Public transportation?
If you are in a pretty remote location, and the first potential employer is 10 miles away, it may be harder to get a tenant.
But all hopes aren’t lost, since you can always rent your place to tourists. Is there a touristic attraction nearby? A nice park, are you next to the highway between two interesting locations? In this case you can market your place as a stopover en-route.
Start by looking at local adds. Your supermarket, community hall or Craigslist are good places to start. Then compare what you have to offer to what is on offer. Have a look at the ”wanted” section to see what people are looking for and how much they are willing to pay. If you offer a quality product, then you will have buyers.
I am renting individually three bedrooms in my flat, to three different people. My prices are a bit higher than the market. But I am offering a fully inclusive price, complete with electricity and broadband, so no bad surprises when the bills come, and I am right in the center of town. People who turn to me are willing to pay a bit more for the convenience.
The same goes for short term rentals, if you offer value, you can price accordingly.
First decide whether you want to rent short or long term. There are pros and cons to having a roommate, as there is to having different people in your house every week.
Long term, you can look at a steady extra income every month, but also need to consider that you will have to share a kitchen, probably a bathroom, and deal with problems when one roommate is too loud or didn’t clean after himself.
Short term you may make a bit more money per night, but you will have to provide sheets, clean after your guests, and also repeat the welcoming speech over and over again, with interesting places to go in your neighborhood or how to use the AC in the room.
How much you can really make will depend on your ability to market your place. In my case, I charge about $600 per room per month. That is $7200 per year. I tried the short term letting when I went on holiday and may try again if I live in a more desirable location, I don’t think it would work in that city though.