How to turn your extra space into passive income
An unused bedroom in your home costs you money. Whether it’s in rent, mortgage or any of your utility bills, one way or another your home costs you money to maintain. So, to help pay for all this, maybe it is time to consider how to make your home work a bit harder for you.
With the global pandemic now (hopefully) coming to an end, and people moving around much more freely and travelling again, especially as they gear up for the upcoming summer holiday season, this might be a great time to start earning some extra income from any space space you might have in your home or rental.
Before doing so, though, there are a few things that you should keep in mind when managing this form of passive income. Let’s take a look at some of them.
Learn your rights
If you own your home or apartment, you can lease your extra bedroom without gaining permission from any other authority. You might, however, have to pay taxes on your rental income depending on where you live and how long your guests stay. If you’re not sure about the laws in your country, consult a real estate lawyer for guidance.
You might also be able to deduct some of your expenses from your taxes each year. As a landlord, whether temporarily or long-term, you’re responsible for fixing things that break and other financial obligations. Deductions as well as the rent you collect can offset the taxes you pay on rental income.
Take photos of your space
When you advertise your room for rent on Airbnb or any other website, you’ll need to prepare a written description of the space. However, great photographs often result in more bookings.
Before you grab your camera, though, make sure to style the space so it looks its best. Rearrange furniture, make the bed with fresh linens, open the windows to let in natural light, and add a few elements of decor to beautify the room. Then grab your camera and click away.
Create your profile
An effective rental profile tells guests what they can expect when they rent your extra room. Include the types of rentals you prefer (e.g. long-term or short vacation stays) and all the amenities you include in the space. For instance, if you brew fresh coffee every morning or have a pool in the back yard, your potential guests will want to know.
When renting out a private room, make sure to let guests know whether they’ll have access to a private bathroom, as well. Tell them which common rooms are available to them, such as the living room and kitchen, and whether you have any rules, such as a no-smoking policy.
Set your rates
You can rent your extra bedroom for a nightly rate, a weekly or monthly rent, or some other method of calculation. Take time to scour the rental listings for similar rooms in your city. What do other homeowners and renters charge their guests?
You might want to offer several different rate options. For example, your nightly rate for a weekend stay might cost more per day than your monthly rent for long-term tenants. And since it’s holiday season, now may be a great time to consider raising your prices a bit. Do a bit of research to determine the going rate in your area.
Rent your room
Once you publish your listing to the public, potential guests and tenants can contact you or book the space. Use the intervening time to spruce up the room or to set house rules for your guests.
Receiving payment from your rentals
Of course, you’re in this for the money, right? So finding a way to receive payments from your online rental platform, like Airbnb, to your bank account account is crucial to making this work. For this, you’ll need a payment solution that is already integrated with Airbnb, Home and Away, Guesty and many other online rental platforms, to accept payments in a currency that suits you.
With Payoneer, your guests can pay you through Airbnb, or any other rental platform you’re promoting your space on, in a currency that suits them. You can then withdraw your funds from the platform to Payoneer where you’ll be be able to use your funds in multiple ways:
- Withdraw to your local bank account
- Use your earnings to pay contractors for any work done on your property
- Pay online or in-store for items needed for renting your space
- Withdraw your earnings via ATMs worldwide
As a property rental host there are a world of opportunities for you to make money, and Payoneer is here to help you manage your earnings with ease.