Your property is the most valuable asset you own; but how can you make that asset work for you? With all that money locked up in the asset itself, are there ways in which you can capitalise on it, and create additional income from your household in the process? Here are six ways you could make money using your home.
RENT OUT A ROOM
One of the quickest and easiest ways to generate additional income from your home is to rent out space within the home, to a lodger. An unused spare bedroom could become a long-term rental space, with the added benefit of lodgers having less legal protections – making for an easy, relatively paperwork-free letting experience.
RENOVATION
Renovating your home can have a significant effect on its sale value, both in the impressions a clean and freshly-decorated space can make on a valuator, and in the concrete adding-of-value an extension can provide. Nationwide reports that adding an extension to your property can add up to 21% to its value. Depending on the amount you spend on the extension to begin with, you could be realising a profit margin of 30% on initial investment in an extension.
EQUITY RELEASE
If you’re over 55, you can access more funds from your home by applying for an equity release. The most common kind of equity release is a ‘lifetime mortgage’, whereby the value of your home (minus outstanding mortgage payments) is paid out to you in advance – in effect releasing your equity in your home – to be paid back by the home’s sale after your movement into long-term care. This allows you to enjoy the value of your home straight away.
PARKING SPACE RENTAL
If you live on the outskirts of a city centre, or near a popular events space such as a stadium or arena, you could rent out any spare parking space you have on your property. Office workers may be willing to pay a small monthly fee to you to park on your land instead of in an expensive pay-and-display, and you can make easy money by renting your space at a premium fee to sports or music fans looking for a safe place to park their car for an event.
DOWNSIZING
If you’re looking to keep some of your money locked up in assets, you could look at selling your house for a smaller, cheaper house. By moving a little further out, or sacrificing some extra space, you could make some extra money in the sale of your home, for you to spend as you wish.
MOVE TO RENTED ACCOMODATION
Another resourceful option is to move yourself into rented accommodation, thus freeing up your home for rental to another family. This is especially shrewd if you have already paid the majority, if not all of your mortgage, off – any rent would be more or less going straight into your pocket, generating you a constant flow of extra cash.
Do you have any other tips for generating income from your home?
If so, be sure to let me know in the comments below.
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