Share with a stranger: the lodgers who won't cramp your style
Laura Harding reports on the flexible arrangements that allow borrowers to rent out a room, pay the mortgage, but enjoy their own space
Sunday 11 May 2008
Living with someone you've never met before may seem unappealing, but for hard-pressed mortgage borrowers, bringing in a lodger could be one of the easiest ways of ensuring financial survival.
Homeowners are allowed to rent out a spare room and generate a tax-free income of up to £4,250 a year – equating to a monthly rent of just over £350. It can be a single room or the whole floor of your house, as long as it's furnished and not a separate flat that you rent out, in which case you would have to pay tax on your earnings.
The rental sector is particularly buoyant at the moment as many people cannot get a mortgage to buy their own place, so there are rich pickings for prospective landlords.
And the arrangements can be flexible, giving homeowners plenty of time to have the house to themselves. It's possible, for example, to rent out a room just from Monday to Friday – possibly to tenants who have a job in the area but don't want to move there full-time.
Judy Niner set up Mondaytofriday.com , a website that pairs householders with people seeking somewhere to stay during the working week. She says the benefits are not just financial: "There is also the social aspect: the lodger often becomes friends with the homeowner and they offer company for older people with 'empty nest' syndrome."
Some people will be able to take on tenants for an even shorter time. Edinburgh residents can charge a fortune for a room during the annual festival, for example, as can homeowners in Cowes, Cheltenham or Wimbledon.
A note of caution, though, needs to be sounded. Michael Flynn, content editor at the FindaProperty.com website, advises you keep track of your finances in order to avoid slipping over the £4,250 limit and being forced to pay tax: "If you exceed your allowance then having a lodger could end up increasing your tax bill. Make sure you stay within the boundary or it won't be worth it."
Mr Flynn adds that you should check out your new lodger through references and identity checks. "It is really important you screen the people moving into your house. You must also inform your insurers and mortgage lenders before anyone moves in. Your insurance company, for example, may wish to adjust your premium."
The tenantverify.co.uk website will run a basic credit check of prospective tenants for £15.88. Alternatively, Experian offers a similar service for £14.50 through its website checkmytenant.com. But data protection rules mean the information on offer is strictly limited. "We are only allowed to give out data that is already in the public domain," says James Jones at Experian. "So for example, landlords will be able to see if their prospective tenant has been made bankrupt, has a county court judgment or appears on the electoral roll." Potentially important information, such as being several months behind with credit card repayments, is not available.
The information website landlordzone.co.uk says that one advantage of taking on a lodger, rather than renting out your home, is that they have far fewer legal rights, making it relatively simple to remove an unsuitable house guest. After you tell them to leave, they have no right to stay because they do not have the same security of tenure as someone who rents an entire property. The website does, however, encourage landlords to draw up a contract with lodgers since there are no statutory rules governing this area.
Then if the arrangement doesn't work out, you can always change your mind.
'If you make the right choice, there aren't any downsides'
Diana Grace Jones, 66, a teacher from west London, decided to look for a Monday-to-Friday lodger after previously having let a room full-time. "You have a responsibility to provide a home for [someone who's there all week], and I didn't really want that any more, but I had the spare room and wanted to use it. I also wanted to have it free at weekends with no obligations."
The £252 a month rent she charges, well below market value, helps with the bills too.
Her lodger, Thomas Rice, 23, works in fashion logistics and spends the weekends at home in Leicester.
Diana says: "I enjoy making someone's life easier – the commute is ghastly. When I first met Thomas, he was terribly tired.
"The most important thing," she adds, "is to decide if you want a young lodger or a middle-aged one. If you get it right, I don't think there are any downsides. The money helps and I'd take in another person if he moved out."
Independent Partners: Get fee-free expert mortgage advice and find the right mortgage deal for you.
Tips on tipping: How and when should you give extra money for good service?
Women born in 1950s facing severe financial hardship over pensions could have fates changed by Ros Altmann - should she choose to help
Is it really that bad in the bond market?
The 10 Best money-saving sites
Pawn again: The rebirth of the high-street credit merchants
- 1 10 ways we damage our teeth – without realising
- 4 Photo of wedding guest proposing to girlfriend in front of bride and groom goes viral
- 5 Charlie Charlie Challenge explained: it's just gravity — not a Mexican demon being summoned
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
British tourists complain that impoverished boat migrants are making holidays 'awkward' in Kos
Australian man punched in the face for defending Muslim women from abuse on train
A nation of inequality: How the UK is failing to feed its most vulnerable people
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
iJobs Money & Business
£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...
£20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...
Day In a Page
This four-bedroom Edwardian home offers a combination of original features and contemporary design after a renovation by the current owners.
In the pretty market town of Bungay, this grade II-listed Mill House is arranged over four floors, offering four bedrooms and three reception areas.
This four-bedroom home offers a vaulted ceiling in a breakfast room that's ideal for summer entertaining with doors that open to the patio and garden.
On the market for the first time in more than 50 years, this six-bedroom home is a project with vast potential - spread over three floors of living space.
This five-bedroom home comes with a range of outbuildings including a large barn which could be converted into a self-contained granny-flat or rental.
Surrounded by rolling countryside, this four-bedroom barn conversion comes with a self-contained, one-bedroom annexe that could serve as an office or a holiday let.
Located near Harrogate town centre, this five-bedroom Victorian terrace is arranged over three storeys while a current study serves as an optional sixth bedroom.
A ground-floor flat in a country house, located a mile from Sway; this two-bedroom home would make an ideal weekend retreat on the edge of the New Forest.
On a popular residential lane in Caterham on the Hill, this four-bedroom family home offers a secluded garden and a convenient location for local schools and public transport.
Just a short walk from Westerham green, this three-bedroom cottage has a light kitchen with exposed brickwork and double doors that lead to a south-facing garden.
In a prime spot opposite the River Thames, this one-bedroom flat has an 18sq ft reception room with glass doors that open out to a private terrace.
Set in the hills above Llanwrda Village, west Wales, this 18th-century three-bedroom farmhouse has holiday-let potential from a separate barn conversion and annexe.
This charming end-of-terrace townhouse is arranged over three floors, with two double bedrooms and a private courtyard garden located at the rear of the property.
Located in the University area, this semi-detached five-bedroom home is arranged over three floors - there's even a rear garden and off-road parking too.
Only a few minutes' drive from the charming town of Marlow, this two-bedroom home sits on the private riverside estate of Harleyford.
This detached four-bedroom home in Middleyard is arranged over two floors, with features that include a wood-burning stove and bespoke oak staircase.
In a row of eight detached Georgian residences, this five-bedroom home offers views of The Sound, Mount Edgcumbe and Cornwall from its impressive veranda and full-length balcony.
If you love cooking for friends this two-bedroom flat - complete with views of the iconic Battersea Power Station and an open-plan kitchen/dining area - will go down a treat.
Located above Grasmere village, this five-bedroom home is arranged over three floors and offers countryside views across Grasmere Lake towards Silver Howe.
Surrounded by the Western fells, this five-bedroom Georgian home retains many original features including panel-plastered ceilings, sash windows and fireplaces.
This six-bedroom home is set amongst three acres of grounds. Currently a large family home, Clift Hill has potential to make a B&B, subject to change of use permissions.
A former period coach house, Glebe Farm Stable is now a three-bedroom cottage with a double car barn, office, kennels and an outbuilding that's currently used as a gym.
Surrounded by woodland, this five-bedroom manor house has plenty of outdoor storage space in the form of three converted loose boxes, two smaller outhouses and a woodstore.
This four-bedroom detached home comes with a double carport, useful workshop, garden and two walkways that offer views of the adjacent countryside.
With space for an equestrian business, a greenhouse for growing your own veg, a wine store and a gym; this five-bedroom home has all the ingredients for a country retreat.
The decked roof terrace of this two-bedroom flat is perfect for summer drinks while large windows and ample storage space make for a light and spacious interior.
Set sail for this four-bedroom farmhouse in Cowes. With five acres of land and an indoor pool, this home oozes character. There is even potential to let a one-bedroom annexe.
Surrounded by approximately 15 acres of grounds, this six-bedroom grade II-listed home has been extensively refurbished yet retains many period features.
This four-bedroom home comes with a two-bedroom cottage and commercial office, with planning to extend, in a stunning courtyard setting.
In a pretty Norfolk village, this four-bedroom family home is surrounded by landscaped gardens, with even a self-contained annex for guests.
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
This five-bedroom home is arranged over three floors of a converted Victorian hospital, offering spectacular views of the Pentland Hills - only three miles from the city centre.
This four-bedroom detached home comes with grounds that span to approximately 2.5 acres, as well as two large patio areas and a double garage.
This four-bedroom cottage is a Grade II-listed town house, well-located for the thriving market town of Nailsworth.
A four-bedroom apartment on the ground floor of a stunning period property in North Yorkshire, with two kitchens and a large south-west facing garden.
This high-spec two-bedroom home is part of a smart collection of new flats at Beaufort Park and has a large decked balcony that's perfect for summer drinks.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Overlooking a golf course, this six-bedroom Edwardian detached home spans four storeys and retains many period features including the original, operational servants' bells...
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
In a Grade II-listed manor just outside of Bath, this three-bedroom home is arranged on two floors with a skylight in a vaulted roof line.
Open the living room's bi-fold wooden doors to reveal a retro-style kitchen, and a conservatory leading to a paved garden at this three-bedroom home.
A Grade II-listed, four-bedroom home, in a charming Somerset village, with a two-storey studio that could be converted into a holiday cottage
A modern four-bedroom Victorian home, within walking distance to the high street
A luxury apartment in the Gothic mansion of Wyfold Court in Kingwood, offers six bedrooms spread over three floors and a turret
This school conversion, near Stockwell Tube, oozes New York loft style. The one-bedroom flat features double height ceilings and exposed brick work
This six-bedroom Georgian home is on three floors with open fireplaces, a two-oven Aga, an annexe, and cottage gardens with outbuildings and a car barn
High Crest House covers an impressive 9384sq ft, with almost three acres of grounds including a tennis court and summer house enclosed by electric gates
A six-bedroom farmhouse with separate accommodation in converted stables. Situated in the village of Church Aston, within walking distance to the market town
A two-bedroom flat with under-heated walnut floors and bespoke built-in storage. The Tube and Clapham Common are a short stroll away
A refurbished seven-bedroom townhouse with staff quarters, cinema room, superb gym, steam room and plunge pool