We’ve been shopping online for homes a lot lately to get an idea of what we can afford with our home budget. We have fallen in love with a few homes, and some of the homes even have guest homes on the property.
One topic that has been crossing our mind a lot lately is possibly using a guest home (or a guest suite) as a way to make extra money.
It seems like many people are doing this lately. I even came across a blogger the other day who is adding an “apartment” addition to the back of their home so they can make some extra money by renting it out.
However, how do you know if it’s for you? I’m always going back and forth about real estate and being a landlord, but I’ve always heard that duplexes and suites on the same property as where the landlord live seem to do particularly well.
Below are some different areas to think about if you are wanting to have an apartment, suite, or a guest home on your property to rent out:
Will you rent the property to short-term renters or long-term?
Renting short-term or long-term can be a very different experience, so this is an area you should think hard about.
A short-term rental usually has the potential to make more money, but there is also more work to be done since you will usually have to provide all the furniture, clean the property, give the keys to each renter multiple times a month, and more.
With a long-term rental, the opposite can be said for much of the above. The renter will usually furnish the property themselves, they will do all the cleaning, you really only need to bother them once (signing papers and giving them the keys), then hopefully the rent checks just roll in each and every month. However, you may earn less money by having a long-term renter living in your property instead of a short-term renter.
Do you like your privacy?
Since your renter or renters will be so close to you, you really need to think about how much you like your privacy.
If the person is in a guest house, then privacy might not be as big of a deal since they will be in an entirely different building from you. However, if they are in the same home as you are, then privacy can be a much bigger deal.
Sometimes you can solve this by having a whole separate apartment (such as a basement apartment or an above-garage apartment) with a separate door from yours.
For us, we wouldn’t be interested in a connected suite if we had children. However, a guest home on a different side of the property would probably be different. For example, we found one home on 15 acres that had a guest home around an acre away from the main home. This home is what spiked this whole idea to us.
What rules will there be?
If someone is practically going to be your roommate, then you will probably want to set rules. We have rented out rooms in our house in the past and have always set rules.
Sometimes the rules are completely forgotten about by the renter, while other times the rental situation has worked out well.
Different rules may include:
- Can they have parties?
- Can they have friends or family members over?
- What about sleepovers?
- Are pets allowed?
- Who cleans?
- Who is responsible for what?
- What about noise volumes?
- Where can they park?
What do you think? Would you ever buy a home and rent out a section of it?
Image via Flickr by rowdykittens