Renting Out A Room In Your House

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Renting out a room is a great way to make a bit of extra money alongside what you already earn. Whether your kids have just gone off to uni, or maybe flown the nest, or even if you have a spare room, you want some use out of, renting is an easy way to earn some all-important extra income.

Whilst renting out a room in your home to a total stranger can seem scary, it is an increasingly common occurrence and during the cost-of-living crisis it could be the solution to rising bills.

But how exactly do you rent a spare room? What steps do you need to take and what are the pros and cons of renting a room out?

Looking for a quick answer? Check out the drop-down menu below!

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What Does Renting Out A Room Involve?

Renting out a room is when you rent out your spare room to either someone you know or a total stranger in exchange for money. It is a great way for people with a spare room to earn extra income relatively easily.

Rent A Room Tax Relief

The Rent A Room scheme is an incentive that the government runs that allows landlords and live-in landlords to earn £7,500 of tax-free income every year, by letting out a spare room in their property.

In order to qualify you need to let out a room or part of your main property but not a self-contained flat. You don’t have to be a homeowner to qualify, as long as you have your landlord’s permission you can use the Rent A Room scheme as a tenant.

If the income is below £7,500 (around £625 a month) and if you don’t normally fill out a tax return then the exemption will be automatic. If you earn above this then it is your responsibility to inform the tax office.

You need to be aware though that the Rent A Room scheme doesn’t allow you to claim expenses for wear or tear or insurance etc.

How Do You Rent A Spare Room?

How you want to rent out your room depends entirely on the person and your housing situation. If you only want to rent your room throughout the week, sites like are perfect whereas if you are looking for something slightly more permanent you can advertise on If you only want to rent out for short periods of time to different people then you can try Airbnb as a way of earning that extra income.

If you do not want to find a lodger through the internet you can always spread the word through friends who may know someone looking for a room or you could try local noticeboards at work or in leisure centres.

How Much Money Can I Make Renting Out A Room?

The main reason that people decide to rent a spare room is for the extra income. But just how much can you charge a lodger?

The amount that you can charge depends entirely upon a variety of factors including where you live, the type of room you are letting, what services you will be provided and what kind of renting you plan to do.


If you live in a major city such as London or Manchester, or somewhere that is a popular tourist destination like the Lake District, you will be able to charge slightly more for rent than homeowners in other parts of the country.

Room Type

Another factor that affects how much you can charge your lodgers is the type of room you are offering. If you have a whole floor of your house to offer then you can charge more than someone who only has a box room.


If you plan on providing meals, doing laundry, cleaning the rooms, and other ‘extras’ then you will be able to charge lodgers more for these bonuses.

Type Of Rental

How often you plan on having lodgers affects the amount of money that you may make from them. If you only plan to do occasional letting then you can expect to make less than someone who has a more permanent lodger.

Pros And Cons Of Renting A Room In Your House

Like all big decisions, renting a room in your house comes with both positives and negatives. The only way to truly decide if you are on board with renting a room out is to carefully consider what it would mean for you and your household and weigh up the pros and the cons.


  • Boost Your Income – The main benefit of renting a room out is that it will be a source of extra income. Whilst the amount that you make will be dependent on a variety of factors, such as location, room type, lodger type and amenities, the extra income that you earn can be used to help pay off your mortgage, earmarked for a larger purchase or even just to make everyday life a little more comfortable.
  • Tax Benefits – As we have already mentioned, the government offers a tax benefit for those who decide that renting a room out is the best choice for them.
  • Simplicity – If you decide to rent a spare room, then you will be spared from a lot of the legal obligations that a traditional landlord has to deal with.
  • Company – If you live alone, then renting a room in your house out to a lodger can be a good way to feel less isolated. Whilst a lodger might be at work during the day, on an evening their presence may provide you with some company. If you are an older person and there are jobs around the house that you are no longer capable of doing, then you may find that for discounted rent, you can get your lodger to help.


  • Outlay – If you decide that renting a room in your house is for you, then you need to be aware that the space that you are offering should be well-furnished to a high standard as well as safe and clean. This can be expensive especially if you bring in tradesmen to do the work. On top of this, you need to bear in mind that a lodger will be using your utilities and unless you both agree to pay a fixed portion of the household bills you will be facing higher bills.
  • Mortgage Issues – Another con of renting a room out is that you will need to inform your mortgage broker. There shouldn’t be a problem as far as the bank or building society is concerned, although they may be apprehensive if they believe that you are depending on this new source of financial income as a way to pay off existing financial commitments or to finance new ones.
  • Clashes In Personality – A downside to deciding to rent a spare room is there is the potential for personality clashes to occur. Whether you are having an old friend or a total stranger, there is always the risk that people won’t get along when it comes to living with them. Traits about your friend that you usually find endearing may now become unbearable, and you and a stranger may simply have no common ground.
  • Security – At the end of the day, when you rent a spare room, you need to remember that chances are you are bringing a total stranger into your home. You should always check a potential lodger’s background as well as getting references from previous landlords.

Top Tips For Renting A Room Out

1. Advertise Your Spare Room

In order to find a potential lodger, you will need to first advertise your room. There are plenty of websites available online that were set up for just this purpose such as MondaytoFriday and spareroom. If you want to go down the holiday home route there is also Airbnb as a potential space to advertise your room. If you decide that the internet route is not for you, you can also advertise on work noticeboards as well as spreading the word amongst friends.

2. Vet Your Tenants

Before you let any potential lodgers move in with you, it is a good idea to vet them beforehand. You don’t have to go overboard with the questioning, but vetting is a great way to get to know any would-be renters and to see how they would fit into your day-to-day life around your house.

Performing a few background checks and asking for a couple of references is usually standard practice when it comes to vetting would-be lodgers. It is also a good idea to carry out a credit check as well.

3. Write An Inventory

Another good idea is to create an inventory of all of the furniture in your room that you are letting out along with a description of the condition that it is in. This way any existing damage, such as marks on walls or loose handles, are all logged. You and your lodger should both sign it at the start of the tenancy so that should anything get broken, you will know whether the damage occurred before or after the tenant moved in.

4. Decide How Long You Will Let The Room

One of the most important things you will need to decide is how long you are going to let the room for. You can do things on a yearly, monthly, or weekly basis depending on the type of lodger you have. You should also give some consideration to how much notice each party should give if they want the agreement to end.

5. Set Some Ground Rules

A good rule of thumb is to establish some ground rules at the very beginning of the arrangement. Let the tenant know exactly what you expect from the outgo, such as your stance on late nights and loud music.

It is a good idea to get these ground rules down in writing so that both you and the tenant know what’s expected. You should also be prepared to make compromises though.

6. What Facilities Will You Provide?

It is important to familiarise yourself with the facilities that your lodger will need. As well as your spare room, your lodger will need access to a bathroom and kitchen by law. Whether or not you are happy to share your living room is completely down to the person.

7. Inform Your Mortgage Lender

Before agreeing to rent a spare room, you should always inform your mortgage lender. It is incredibly unlikely to cause any problems but if you don’t notify your bank or building society then you could cause a breach of your mortgage terms.

If you own a leasehold then you should check with the freeholder whether it is okay for you to take in the lodger. This kind of information should be on your lease agreement.

8. Inform Your Insurer

Whilst you are informing your mortgage lender, you should also take the time to inform your insurer as it could affect your cover. It is always a good idea to check policy exclusions in your policy wording so you know where you stand. You risk invalidating your policy if you don’t tell them.

9. Request A Deposit

It is standard practice to ask for a deposit upfront when you let out a room. A deposit will provide you with security in the event of your lodger suddenly leaving owing you money or if they cause any damages.

A deposit can be any size but usually, a months’ worth of rent is a fair amount to ask for.

10. Check Council Tax

Another important element to check is council tax. If you live on your own, you’re entitled to 25% off your council bill. If you take in a lodger, you will lose this discount and will need to let your council know.

You should not lose this discount if your lodger is a full-time student, but it is always a good idea to check with your local authority.

Is It A Good Idea To Rent A Spare Room?

Whether or not it is a good idea to rent a spare room is completely up to the individual. It can be a great way to earn some extra cash and if done through the government’s Rent A Room scheme will mean tax exemption as well.

However, it also means sharing your house with a stranger which can present its own unique set of challenges. Because of this, renting a room in your house is not the ideal choice for everyone.

This covers everything that you need to know about renting out a room. If you have any questions, queries, or insight into the matter, please feel free to get in touch!

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photo of Alexandra Ventress

Alexandra is a junior content producer who enjoys writing articles and finding out more about the property market. Read more about Alexandra here.

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About Alexandra Ventress 91 Articles
Alexandra is a junior content producer who enjoys writing articles and finding out more about the property market. Read more about Alexandra here.

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