6 Tips for Renting Out a Room in Your House

Written on February 23, 2015 by

Renting RoomsRenting out a room in your house is sometimes favorable to leasing the entire property.

It offers more flexibility for your own private use of the other rooms, and renting multiple rooms can often be more profitable than renting the whole house under one lease.

People who live in shared households are an increasing bunch. In 2012, some 22 million households had this arrangement, and of those, 9.7 million were young adults living in someone else’s house.

Lots of homeowners find themselves with an extra room or two on their hands that they never use.

Renting one out might be the solution to some extra cash. However, please check your state and local county laws to ensure compliance with housing, license, and fee requirements.

Here are six tips you need to know before you start marketing your room.

1. Prepare the House

If you’ve ever had kids, you probably know about baby proofing – painstakingly going through every room to ensure you took all the right safety measures to keep your little one from harm.

You need to go through your house just as thoroughly, “renter proofing it”, before you consider even showing it to strangers to ensure the safety of your belongings.

  • Put keyed deadbolts on each bedroom door (use SmartKey locks)
  • Remove self-locking door knobs to prevent lockouts
  • Put that diamond tennis bracelet in a fireproof safe. 
  • Fix anything that needs a little TLC. If you have to hit the microwave on the side to get it to start, it’s time to buy a new microwave.

You then need to decide which room or rooms you’ll rent.

You can get more money if the room has its own bathroom. You might consider renting the master bedroom and taking a smaller bedroom for yourself. A basement setup with a kitchen can be even more lucrative since it provides more privacy than a shared level.

2. Figure Out What to Charge

Look at the ads on Craigslist, or sign up for a service such as Roommates.com or EasyRoommate. This should give you a ballpark figure on what you can expect to get based on your ZIP code and type of room you’re offering.

Any money you receive is taxable income. The good news is that you now have deductions and can claim expenses – at least for the portion of the property that is being used as a rental. For example, new carpet in the renter’s bedroom is a deductible expense, but new carpet for the entire house is not.

A tax expert (or TurboTax) can help you with this.

3. Determine your Non-Negotiables

Be honest with yourself. If you can’t tolerate a smoker or a party-prone college student, say so in your ad. If you want someone who can stay for at least six months, indicate that, too. You’ll save yourself a lot of time that way.

Otherwise, you’ll be tempted to accept a smoker/pet/whatever, because you didn’t set clear boundaries for yourself.

If you live within walking distance to restaurants, have access to a pool, live near a college, allow pets or have any other perks, list them in your ad.

Don’t forget to post amazing photos. If you don’t, many people will bypass your listing.

Related: The Landlord’s Guide to Marketing with Craigslist

4. Use your Intuition, but Don’t Discriminate

Think about what you want to ask a potential renter in your initial conversation. We provide a screening checklist in The Landlord’s Guide to Tenant Screening, which will help you evaluate each candidate fairly.

Find out what each applicant’s situation is and look for holes in their story. If the applicant says he or she works or claims to be a student, ask to see proof, such as pay stubs or proof of college enrollment.

Also, make sure you not only ask for references, and contact information for previous landlords, but call them too.

Above all, make sure you provide an equal housing opportunity, and avoid discrimination (and the appearance thereof).

Related: Know What is Considered Illegal Discrimination

5. Verify with a Credit Check

If the interview and reference checks go well, run a credit check. Cozy makes it super easy and quick to check tenant credit. It’s free for landlords too.

With Cozy, you’ll get a report from Experian, and based on what the report says, you’ll be able to decide whether the candidate will make a good renter for you. The report will automatically be paid for by, and shared with the tenant, so it doesn’t cost you anything.

Related: Easy Tenant Credit Checks for Landlords

6. Use a Written Rental Agreement

Make a written lease instead of an oral arrangement. Everyone remembers a verbal agreement differently and it is tough to prove in court.

When creating a written lease, remember to specify the following attributes, in which both you and your tenant will sign to:

  • How much the rent will be
  • The date the money is due
  • Whether the renter will pay utilities, and if so, which ones or what percentage
  • How you will handle food, fridge space, laundry, common areas
  • Any other concerns you have (cleaning, parking, quiet time, etc.)

Once you start covering a good percentage of your mortgage from having a tenant in your home, you might wonder what took you so long to start doing this.

What’s Else?

Do you have experience with renting part of your home? What advice do you have?

Let me know in the comments below.

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204 CommentsLeave a Comment

  • Tanya

    Hi, I am thinking about renting an extra room in my house. Can I legally limit the number of guests that are allowed to visit the tenant and can I legally limit the number of overnight stays the tenant is allowed to have and charge them a fee for their stay? For instance, can I state that “a $10 fee will be charged per person per overnight stay” and “only 7 overnight stays are allowed per month, after that a fee of $20 per person per overnight stay will be charged”? Thanks I just want to limit who goes in and out of my house bc I have kids. I can do background check on the tenant but not their guests. It’s an extra room in my house.
    Thanks

    • California landlord

      I usually have a discussion up front regarding guests with a potential renter. Put the terms in a written agreement. I myself wouldn’t charge extra for the guest stays, but incorporate it into the rent making the assumption they will have guests over. Monitor and document the number of stays, dates, etc. You can also say no overnight guests because you have kids. If they break the terms of the agreement, then you have grounds in which to give them a 30 day notice the 1st year It may be 60 day notice of they’ve been there more than 1 year. Check the Landlord and Tenant guidelines for your state, because if you are the homeowner and also living in the home then you may not have to give 30 days. Also, do background and credit checks.

  • Donna Byrne

    I am 64 yrs old and would like to rent out a room to another older woman who may not like living alone, all I see is ads for younger people. Do you have any suggestions how to advertise.

    • Laura Agadoni

      Hi Donna,
      I personally don’t know of any specific websites that advertise for older women roommates. Maybe one of our readers knows. In the meantime, you can specify in your ad that you are looking for another older woman to share your house with. Good luck!

  • James D

    Hey Donna,
    I have a whole basement I’m looking to rent out. It’s 2 rooms with approx 1200sq ft total with a private entrance and a 1/2 bath. I’m debating if its worth the investment to add a shower to that bathroom and a kitchen. There is a full private bath upstairs for them and a shared kitchen but its on the main level.
    Also how picky can you be with who you select without it possibly bring something like a discrimination lawsuit against you? Had a friend deny a tenet basically cause he didn’t have a good feeling about them then that person sued him for housing discrimination. He is currently still dealing with that and his property is on hold because of it. I want to avoid this.

    • Laura Agadoni

      Hi James,
      To find out whether it’s worth it, you’ll need to do some number crunching. Check to see what comparable units to yours are going for and how much more people are getting with a full bath and kitchen. Then find out how much it will be to renovate. Then decide. When it comes to selecting someone you will share your home with, you absolutely have the right to determine whether you will be compatible. Set up a list of non-negotiables, as in the article, and if a potential renter doesn’t fit, you don’t have to rent to them. Here are some dos and don’ts when screening: https://www.landlordology.com/questions-to-ask-potential-tenants/

    • Regina

      I am in the same situation as you but, I do have a full bath downstairs for a potential renter. There is no kitchen. I have thought about buying a smaller fridge and microwave for the renter to use. If they want to bake they would be more than welcome to use the oven in the main kitchen.

  • Lara H.

    Hi Laura,
    I rent a room from a couple & have my own bathroom. This however is pretty much ALL of the space that I am provided. When someone rents a room isn’t it an assumed fact that the renter has some belongings that do not go in a room? Isn’t that just an obvious? Things such as suitcases, a really small ladder, cleaning supplies (to clean THEIR HOME!), etc. Also, the couple are SUPER SUPER penny pinchers! I’ve been there for over 3 months now & they’ve only turned the A/C on 1 TIME! With it being almost mid-June the weather is HOT! They have ceiling fans but they don’t help! My room is like a sauna & I’m constantly sweating! Also, I was told the other day not to take long showers! OMG Is this even allowed? Thanks you! Lara H.

    • Laura Agadoni

      Hi Lara,
      There are no universal rules for when renting a room in someone’s house. Any issues are between you and them.

    • Lauren cimino

      Hi Laura, I recommend asking your tenants if you can either buy a portable AC unit (you’ll have to have a window for) or if they will provide you one with their choice and you pay 1/3 of the rent. Make sure to include that it will be an energy efficent one so they don’t scare off. We have a portable air unit in our basement for our renters and they pitch in for electricity. It works great.

  • Opal salone

    Hello my name is Joyce and I have a room in my home for rent and back

  • Regina

    Has anyone rented to a family member? How did it work out? Any suggestions for doing this?

  • kJ

    I live in a residential zoned area of NY State. Can I rent out romes in my home for extra income?
    Can the neighbors turn me in to the town supervisor or police?

  • Lien

    Is the website available for those out of US?

  • Victor

    If the state prohibits renting rooms, is it best to avoid written lease agreements or is there still a benefit to doing one anyway?

  • Debra Dicenso

    I am a 52 yr old woman on disability. I am interested in renting a room from someone mello and responsible. I live in Los Angeles County. I am not perfect but I do pay my bills and have my own truck. Thank you.

  • philisiwe Makhathini

    I got the outside 2 rooms in my house for rental in Kagiso Riverside I need people who need to rent .

  • Liz Baker

    If i rent out a room for 400 lets say, do I need to put that on my taxes or is it small enough where i dont have to claim it? Also do I need special insurance?

  • Pauline Reno

    What if the renter doesn’t give you any lease and just takes your money and then kicks you out and keeps the money you gave him for rent and your belongings for something he didn’t say to you in the beginning. And makes you leave on the spot or he will beat you up he won’t do this to makes but he will the women what can a person do to get help I’ve started many months because of this guy who rents rooms cause he does all of this. What can I do to stop this

  • carly

    Ive gotten my feet wet renting out a room 1 went great and 1 got tossed out. Is there a particular “resident at will’ agreement? Im in Boston, Massachusetts and cannot pin anything down, its wierd, yet everyone does it~ In researching there seems to be distinct differences bc they’re technically arent a tenant w an apt which is what all the contract say. . . why is this isnt simpler to find out~
    ANY ADVICE?

  • Confused in Charlotte

    I am a live-in landlord and have 2 rooms for rent. Unfortunately, they share a bathroom. Would you recommend trying to rent out both rooms to the same person or lower the price and rent out each room separately but clearly note that they share a restroom.

    Also, do you have any advice about pricing in this situation? I’m having a hard time finding room pricing information in my area of town.

  • Barbara A

    Hi I rent out my spare bedrooms and I have tenants who have lived with me for a few years. Month to month. The shared spaces are the bathrooms (2) , kitchen and dining room. Free laundry and parking. I don’t ask for much but I would like to makes some changes. Their rent includes utilities (Heat, Water and electricity). I would like to put some restrictions on how often the wash machine is used. I swear laundry is being done by one of them every other day. Is it ok to tell them to cut down on laundry or should I put in one of those coin wash machine units to help with the cost?

    • Laura Agadoni

      Hi Barbara,
      This would be a good time to start implementing No. 6 in the list above if you want to set up laundry rules. If you wish to use a coin machine you can do that too. Whether you use a coin machine or set up rules for how often renters can use your machine, it’s a good idea to have a written rental agreement with all the terms that everyone signs.

  • Andy L

    Hi Barbara
    I live in Florida where I’m currently renting a room from an elderly man I’ll refer to as Mike. I moved in back in March and I agreed to and signed a years lease with Mike to rent a room in his house for $600 a month while he still lives there. At the time there was no lock box over the thermostat but shortly after I moved in he put one on claiming that one of the other roommates was turning the AC down too much. After he did that the other roommate moved out and now I am planning on moving out without giving him notice. My question is can he sue me for the remaining rent for the lease despite he changed things afterI signed the lease? I wouldnt have moved in if I knew he was going to install a lock box over the thermostat

  • Jorge

    Hello Donna,
    I have a tenant to whom I gave a 30 day eviction letter, I asked her before she left to leave the room clean and no broken furniture, because that would be charged from her deposit, we signed a rental agreement, in the contract says that the deposit could be used for cleaning or repairing any damage, she sent me a text message telling me that she will not clean anything and the room will be dirty to show it to the new renter and that she still wants all her deposit back, in the contract she says that the remaining deposit will be returned 21 days after vacating, tell me what else can I do?

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