Profit From Renting Rooms in Your House


You have to be prepared for some drama when renting rooms in your house. Unlike renters in another house or apartment you own, these ones will be right there with you on the front porch or in the kitchen. That's okay if you like people and you choose good tenants, but it's still something to keep in mind.

I did this for years, and it was worth it. I made friends and made enough money to pay off the mortgage early. Later, when I married, we built a small efficiency apartment on the back of the house so we would have our own space--that's one way to deal with the loss of privacy that comes with renting rooms in your house.

Why would you want to rent rooms to strangers (or even to friends)? The money, of course--and I'll have more on that in a moment. But keep in mind that this is something you can do starting this week if you own your home, and it is instant cash, which comes in every week (if you charge that way). You also have more control when renting rooms versus renting a house that you buy for the purpose. You can keep track of your renters easily when they live with you.

How Much Can You Make?

My first house was a mobile home on a small lot in a small town in Michigan, and I easily got $75 weekly for a room in the 1990s. That's $3,900 per year, by the way. I eventually rented out three rooms when we had built our efficiency unit on the back of the place.

What you can charge depends on rental rates in your areas. If you live in a college town where two or three young people typically pool their resources to afford a $950-per-month house or apartment, you should easily get $100 weekly if you include all utilities. Two rooms at that rate and you'll have an extra $10,000 annually (the added expenses of additional people living in your home are minimal).

Ways to Make More | Related Opportunities | Tips

I set up a "grocery store" in a closet and made money selling ramen noodles, potato chips and whatever else my tenants wanted me to stock. I bought pop for 25 cents-per-can and sold it for 50 cents. I charged $5 weekly for parking an extra vehicle in the yard.

Always include every utility. The attraction of renting a room is having no surprises and no bills to plan for. Also, you don;t want to deal with three different people arguing about when they'll have the money for bills and who is using too much water, etc. If the heating bill goes higher, just raise the rent and forget about it.

Skip the security deposit and you'll have less paperwork (separate accounts are required for deposits). Also, by keeping it less formal you remind the renters that this is your home, and they are less likely to appeal to rental laws if you need to evict them.

Charge by the week if your tenants are paid that way. Many room renters are great people, but an inability to plan for coming expenses is common. make it easier for them and for yourself. Also, renters will feel that $100 weekly is $400 per month, when it is actually $433.

Qualifications / Requirements

Generally you need to own your home to do this, although if you rented a large house and had permission from the landlord (perhaps by paying higher rent), you could rent out several rooms and essentially live for free.

First Steps

Look in the local newspaper classified ads to see what people are getting for rooms in your area. You can also check on Craigslist. Create a set of house rules that every renter has to abide by. Try one renter for a while before you commit to doing this with more.

Resources - This is my own e-book on the subject, with details on how to determine how much to charge, house rules to have, how to deal with problems and much more. It is now free. - A website where you can find tenants.

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Other Relevant Pages

Work From Your Home

Real Estate Profits Pages

Here's a fun article on renting rooms near your house--renting a shed as a bedroom:

Shed Bedroom

Every Way to Make Money | Profit From Renting Rooms in Your House