For most people, the purchase of a house through a mortgage is the most expensive purchase we’ll make in our lifetime. Given the amount that you’re spending, it’s worth thinking about every possible way of making a little back from the purchase. Let’s take a look at a few of the most popular ways you can utilise your home to get money back.
Renting
If you’re able to let your property out for rent, then you could make a profit on it every month. Of course, while you’re doing this you’ll need to find a place to live of your own – but if you’re paying less in new mortgage payments on a new and utilities than you’re charging in rent, then you stand to make a steady income. This might be the case even if you didn’t actually buy the property with a view to renting it. Similarly, you could rent out your owned home to a tenant, then renting a new place to live for yourself, making sure your monthly payments are lower than your tenants you’ll be able to make some profit.
Equity Release
If you’d prefer to stay in your home, and you don’t want to give up even a small part of it, then equity release might be an appealing option for generating cash. An equity release will release some of the stored value in your home, giving you cash to spend immediately, allowing you to use this to pay for holidays, new work on your home or large payments.
It’s an option that’s often preferred by retirees who’ve already paid off the mortgage on their property, you have to be over 55 to choose this option so consider if this might be for you.
Downsizing
If you’re willing to sell your existing property and make the move to something smaller and less expensive, then you’ll be able to pocket the difference between the two. This, again, is a popular move for older people who’d like to fund a luxury retirement.
If you no longer need the extra room to house your children (who’ve moved out), then it only makes sense to make the switch to a smaller property. This also provides a good opportunity to move locations, if in older age you want to move away to the countryside, you could sell the more expensive city home for a less expensive country house, allowing you to move away with some money in your pocket.
Before selling your home, there are a few things you should consider.
The first is what kind of money you can make from the sale. It’s important to remember that the price of your home is just one factor in the equation. You also need to take into account factors like local real estate values, how long it will take to sell, and any repairs or updates you may have done to the home in addition to its market value.
Another consideration is whether you’re ready to move. If you’re not sure if moving is right for you, talk to an agent about your options. An agent can help you determine how much money you can make from selling your home and give you tips on staging it for maximum appeal.
Finally, think about how long it might take to sell your home if it’s placed on the market. Real estate agents typically have a suggested listing price that they would like their client’s home to sell at, but this doesn’t always happen. If your home isn’t listed at or above the suggested price within a certain time frame (usually 30 days), an agent may list it at a lower price in order to get it sold sooner.
Renting out a Room
Some homeowners might elect to divide up their property especially for the purpose of renting. This tends to be practical in larger urban town-houses, but it’s an option just about everywhere. Renting out a single room to students and tourists might be practical, but you’ll usually need to make a few modifications to the building to make it so.
You might even split the space in two, and have a separate entrance for your would-be tenants. However, if you have a home in which you don’t need all of the provided rooms, taking on tenants for each room can be a good way to make the most of this. This can be good especially in student areas, or areas near universities where students and international students will be looking for personal accommodation.
Renting out Space
The actual living space inside your home isn’t the only thing that you might consider renting to other people. There’s also the storage space in your garage or the possibility of renting the parking space on your driveway to employees of nearby businesses, especially in the city or busy towns. Either might be in considerable demand. If you’re the owner of a particularly impressive house, you might even find that there’s money to be made in hiring it out to television and film productions, or in turning it into a wedding venue.
Take advantage of seasonal opportunities
While many people are looking for ways to make extra money, there are a number of opportunities that can be taken advantage of during seasonal transitions. For example, consider hosting a Christmas party. This can be an excellent opportunity to make some extra cash and connect with your neighbors.
Alternatively, consider selling flowers in the summer months. This is a great way to earn some extra income and meet new people. Finally, consider renting out your space during peak season. This can be an excellent way to earn money while freeing up space in your home for other purposes.
However you choose to utilise your home, there are different ways that you can make the most of the space you have. Selling part of it, getting money back from it or reducing the size and leaving you with the difference. Deciding which best suits you will allow you to make the most of your home, using it as the expensive asset it is and capitalising from it.
