Thanks to platforms built around services such as those which allow you to rent out your couch or even just a room in the house for a short period of time, like for one night, it’s now possible to get that much-needed boost to your pockets at pretty much any time during the month. All kinds of spaces can be rented out for extra money now, but there are a few things you need to know before you go down this path.
Insurance premiums get affected
Whether you’re a renter paying renter’s insurance or if you’re the outright owner of the property paying homeowner’s insurance, either way, renting out your property even for super-short term tenants will inevitably affect your insurance premiums. If you’re renting property and you effectively sublet, a little bit of a conundrum will perhaps present itself to you because you have to let the property owner know so that they can let their insurer know. This will probably mean they’ll have to contend with increased insurance premiums, however slight those increases may be, but what it also means is that they’ll justifiably likely want to recuperate those additional costs from you.
So it sets off somewhat of a chain reaction in which the costs will likely ultimately be passed on to the guest who is staying over.
Insurance premiums have to increase as a result of sub-letting to earn extra money, simply because all the guests who come to stay over pretty much just make for an added security risk. Yes, there may be formalised structures over which the arrangements to receive guests are made, complete with ratings, vetting and all the security measures deployed as far as is within reason, but at the end of the day it’s still the type of situation where strangers are being let in and out of your property.
You need to report your earnings
When this sort of thing works out for you then it works out really well because what you’re essentially doing is renting out some space in a property you live in yourself, which means anything beyond recuperating what you spend on your own rent or utilities is pure profit. It’s about as passive an income stream as it gets, with perhaps just a little bit of admin in the form of meeting and greeting your guests and getting the payment formalities out of the way.
These are earnings you need to report though, especially taking into account the tax implications.
Certain standards must be maintained
Remember that this sort of thing relies heavily on user ratings so it is your guests who come and stay over whom you must please, not yourself, so you’ll have to make sure to have a living relationship with the local pest control service provider among many other such service providers to make sure the space you’re renting out is more than just a little comfortable for human inhabitation.
Look towards some of the boutique hotels for some interior decor inspiration if you have to, because it’s not about your style but about a welcoming environment.