If you find yourself with an extra room in your home and are eager to generate some additional income, renting it out could be a viable solution. However, before taking the plunge, there are several considerations and necessary steps to ensure a smooth process.
Firstly, decide whether you want a long-term roommate or short-term guests through platforms like Airbnb. Regardless of your choice, it\’s crucial to feel comfortable with the individuals sharing your space, secure appropriate insurance coverage, and understand the potential financial implications, including taxes.
Who Can Rent Out a Room?
If you own the property, you\’re generally free to rent out a room at your discretion. However, if you\’re a renter yourself, check your lease agreement for permission. Each state and territory has specific rules on subletting, so it\’s essential to verify with the relevant authorities. In Western Australia you can check out Consumer Protection.
Finding the Right Housemate
Deciding whether to rent to someone you know or a stranger is the first step. Renting to acquaintances may be simpler, but it comes with potential downsides. If opting for an advertisement, consider reputable websites like flatmates.com.au or flatmatefinder.com.au. Community boards on platforms like Gumtree and Facebook groups can also be useful.
Setting Rules for Housemates
Establishing clear house rules is crucial for successful cohabitation. You need to consider a number of factors and have a formal agreement in place.
- What bond amount is required and if you want one to be paid at the start of the agreement.
- Rental payment and frequency.
- Bills for utilities, internet and any streaming services, whether these will be included in the rent.
- Food and cooking expenses, and whether these will be shared or separate.
- Pets, what would be acceptable if any.
- Cleaning: a clear set of rules who is responsible and for what tasks.
- Guests and what kind of visitors are appropriate.
- Noise in the house and your expectations around this.
- Parking for vehicles and bicycles/scooters etc.
- Moving out, including the terms and how much notice you would like.
Tips for Choosing a Good Housemate
To narrow down your selection, consider inviting potential housemates for inspections and informal chats. Learn about their habits, lifestyle, and work situation. Asking for references from former landlords or employers can provide valuable insights into their suitability as a housemate.
Renting a Room on Short Stay Platforms
Creating an account on platforms like Airbnb or Stayz is the first step to renting a room for short stays. Verify your identity, provide necessary information, and create a compelling listing with accurate descriptions and appealing photos. Set a reasonable price, considering local rates and demand fluctuations.
Ensure your property is clean, well-furnished, and stocked with necessary supplies. Keep in mind that using short stay platforms may involve fees or a percentage of your earnings.
Home Insurance and Flatmates
Standard home and contents insurance may not cover damage caused by subletting. Consider landlord insurance for coverage. Some short stay platforms, like Airbnb, offer host liability insurance. Renters should explore renters insurance to protect personal belongings, as landlord insurance won\’t cover them.
In conclusion, renting out a room can be a rewarding experience with proper planning and consideration of the various factors involved. Whether choosing a long-term housemate or embracing short-term rentals, understanding the rules and having the right insurance coverage is essential for a successful arrangement.