Owning a family home is a common dream for many Americans; one that comes with a significant investment on your part. According to the U.S Census Bureau and GoBankingRates, an average American home comes with a $360,000 price tag and a $1,207 monthly maintenance bill in 2017. Of course, as with any investment, your home can provide a decent return on your investment beyond the appreciation in housing prices for the years you occupy it. Mortgage and maintenance bills that come with owning a home can be impressive.
However, if you have some free space and with some smart conversion and home improvement tricks for spaces, your home can begin earning a very lucrative return. If you are one of the thousands of American homeowners thinking of ways you can make your home work for you, check out a few of these ways below.
Open your home to lodgers or travelers
Thanks to the rise of rental platforms such as Air B&B, homeowners can now rent out their homes while they are on vacation or even rent out that spare room in their home. Depending on your familial preferences, you can play a host to international students coming to college if you are situated close enough to campuses. This is very common among medical students on their yearly placements or college students spending the semester on an exchange program.
According to finders.com there are over 33.6 million spare rooms across America, with Georgia taking the sixth spot for the number of spare bedrooms by state. With just over 1.66 million spare rooms in the state, they stand at a value of over $8.6 million dollars. Think about it; with an extra $100 each week from rental of that spare bedroom or garage (although the state of Georgia saw a 16 percent increase in rental rates for 2017), you could be looking at an extra $400 dollars in income each month which can either go towards savings or covering expenses such as repaying debt or making additional payments on your home mortgage.
Leverage built up home equity
Over the time you and your family have occupied your home, you would have built up some amount of equity on your home. For older homeowners and those that have been on the property ladder for a longer time, options such as reverse mortgages are great to secure some extra income without thinking of a second job. For seniors, the reality of losing employment income and being able to stay in their current home can be very daunting. According to AARP, almost 90 percent of seniors wish to remain in their home.
Reverse mortgages are aimed specifically at these homeowners and allow the lender to pay them the equivalent of their home equity in cash. If you are thinking of a reverse mortgage, there is a great deal of information online to estimate the amount seniors can borrow against their home.
Keep in mind this is a loan and it is typically settled upon their passing or sale of the home. Some lenders do allow early repayment so if you are considering this option be sure to go over your terms with your lender. As with all borrowing, reverse mortgages come with their benefits and drawbacks.
Turn those unused storage spaces into cash flows
Renting out a spare room is not the only way you could be earning home from your home. You can now rent out parking spaces, which is particularly sought after in cities and near commuting amenities. If you have a garage or storage space currently not being used, platforms such as Spacer can help you list and rent out these spaces to individuals looking for additional storage. If you are up for some DIY, projects to transform your garage or spare space into another bedroom can be budget friendly but incredibly lucrative in income.
Any of these ideas can get you started on maximizing the return you get from your family home. With some effort (and in most cases, minimal effort), you can witness your home becoming a source of income for you and an important part of your financial success.