One of the most important assets you can leverage to make more money is your home. Homes are smart investments and people are re-thinking the best ways to use a home to create wealth. Not only does your property grow in value, but did you know your home could actually become your best money making asset? What if you could live in your home, mortgage-free? Do you know how to turn your home into a business?
While not every option is easy and each requires some sacrifice, you can make some serious cash. Here are 5 ways you can turn your home into a business.
- House hacking
- Rent your home
- Start a business in your home
- Rent out the storage shed
House hacking has become a new phenomenon in recent years. Essentially, you rent out a room or several rooms to cover a portion of your rent. Each member of the household will cover a potion of utilities and miscellaneous expenses and pay rent to you. House hacking allows you to live rent-free and use that money elsewhere.
This option is best suited for those who can live with other people and don’t have kids. You’ll be a landlord and live with your tenants. Living with someone you barely know can be tough. Yet, with the right guidelines and clear communication, you can live with most people.
Do your research. Becoming a landlord is a learning process as with most business endeavors.
Airbnb is one of the premier ways on how to turn your home into a business. You don’t have to have a full-time tenant like with home hacking or other methods. Instead, you can rent your room out for a couple of days at a time.
Anytime someone checks in to your Airbnb you get passive income. This can be a great way to build an emergency fund passively or pay the mortgage on your home. Running a profitable Airbnb does require some diligence. The best part about this option to turn your home into a business is that you don’t have to rent out your whole house! You can rent out just a room or set of rooms.
In addition, you don’t have to just use your house. Fixing up a shed and making it livable can become an extra source of income.
Rent your home
If you want to move out of your home, but want to keep that property as an investment then you should rent it out. There are two theories when it comes to renting out your home, each with their own positives and negatives:
- Rent to college students and charge per room.
- Rent to a family and charge enough to cover your mortgage.
Renting to college students on a per room basis can mean more additional money. If you live in a college town, you will almost assuredly have a fresh crop of tenants every year. Your rates have the possibility to go up as more and more kids come to college. Yet, you may find that tenants are often looking for 6 months leases, which means turnover is high. On top of this, college kids can be rowdy, don’t have access to a full time job, and can’t pay some higher prices.
Renting to a family means you will often have longer contract tenants, and less parties are usually thrown at these locations. That doesn’t mean life will all be roses. You still will be responsible for all maintenance and upkeep. Don’t go into renting blindly. Take some courses on renting and attracting tenants in your neighborhood.
Start a business in your home
You can always start an online business and write off part of your home’s expenses as business expenses. You can also physically start a business out of your home, using it as an inventory space for your goods or services. Either of these options can lead to big tax write-offs and making your home an even better asset.
Rent out the storage shed
Have an old storage shed or garage? One of the little known ways to make money off your home is to rent your storage space out to someone. Home owners can often charge lower rates than competitors and add extra security measures to make people’s belongings safer.
Consider renting out the space for cheap and get money to work for you!
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