Are Rooms for Rent Worth the Investment?
Quit staring at those empty rooms in your house in Burbank, dwelling in the past on the memories of those who used to occupy them. Time to start making them work for you. You heard that right. You can make those empty rooms earn good money for you by renting them out. With prevailing high rental prices, you’ll be happy to know that rooms for rent are all the rage. Look at AirBnb! They’re minting money based on the same concept. We know, you must have all sorts of questions popping in your head as you read this, among them, “Is putting up rooms for rent worth the investment?” Let’s see.
Cons
We like to do away with the “cons” first so that all your fears out there on the table. With every type of investment there are always negatives, so here are some if you decide to put up rooms for rent.
Privacy
Depending on the type of property you have (house, apartment, and guest house), there are chances of invasion of privacy. If you’re the quiet type, don’t like to mingle and prefer to keep doors locked then perhaps you might want to think this out. There WILL be sharing of your living space who might share the kitchen, TV, or garden etc. They might barge in a family gathering when you really want to just hang out with your family members, or while you cuddle with your date on the couch in the living room. For this you need to have house rules.
Utilities
Since renters will be boarding your house, and not actually renting the whole of the property, you’ll have to bear utility expenses including gas, electricity, water, and internet etc. This is because since there are no separate meters, no separate billing can be done. Moreover, you can’t really control how much they spend; the least you can do is request them to not waste.
Maintenance
Where there are multiple people living, wear and tear happen, and this cost is borne by the landlord. You’ll be responsible for fixtures, furniture, structure, paint job, seepage, plumbing and any other issues that renters may face during their tenure at your place.
Pros
Finally, the good part of letting your rooms for rent. If you’ve considered to go for this channel of renting your property then you must also know that the positive outweighs the negative. Why else would you read this article?
Additional Income
It’s obvious that you’ll be getting the much needed additional income, but did you know that letting your rooms for rent is pure profit? Unlike giving up your whole property on rent, when you let your rooms for rent, you don’t have to fear the in-between-renters empty slot because it doesn’t cost you anything. Moreover, the additional income is just that – additional income because even if you minus the utilities and maintenance you still have a big chunk of income if you know how to price your rent. For that you might want to refer to a property management company or real estate agent in Los Angeles who knows the market rate. With the profit you could use it for paying off your debt, mortgage or invest further.
Optimal Space Utilization
As a homeowner you might not think of this, but we, real estate people take space utility very seriously. Things like how much space can be utilized by how many people per square feet (or meter), matters. If you’ve got an empty room in your house which is not used by anybody then that’s a waste of living space. When you put it on rent, that space earns for you instead of just being wasted. Now this might motivate you to put up the rest of the house on rent but hang on to that thought until you get your first renter.
Earn to Invest
So, we’ve hinted earlier on earn to invest. Let’s assume that you don’t have debt or mortgage to pay, then why would you go through all the pains to let out rooms for rent? We’ll tell you why. You could use the additional income to save and invest in a rental property that may earn you even more income. On average if you put up your room on rent for $250 per week, then that’s $12000 per year. If you put up a couple of rooms on rent then double that. So, from the first year you could earn mortgage down payment for your new property. Continue to put the rooms on rent to pay off the mortgage while the new property will earn its own rent. Sounds profitable now, right?
All in all putting up rooms on rent is worth your time, money and effort. If you’re still in doubt or considering how to get renters then refer to Los Angeles Property Management Group. We’re here to help you work with you to achieve your real estate investment goals.
