Househacking is a popular way to earn passive income through real estate, and it involves renting out a part of your living space. This approach is ideal for those who own a home and want to offset expenses or pay down their mortgage. The good news is that you can househack regardless of your housing type, whether it’s a house, condo, or any other type of property. Here are some options to consider:
Rent out a room: If you have extra rooms in your home, you can rent them out individually to tenants. This approach is ideal for individuals who don’t mind having roommates and sharing common spaces like the kitchen and bathrooms.
- Renting out rooms is also a great option for international students or young working adults.
- Rent out your basement: A basement unit, also known as an accessory dwelling unit (ADU), can be a great way to generate passive income without sharing your living space with tenants. To be considered a dwelling unit, the basement must have a kitchen, washroom, and sleeping area. The unit should also have a separate entrance and meet specific safety requirements set by your local government.
- Rent out your parking space: If you live near public transit or in a condo and don’t need your parking space, consider renting it out. This option is ideal for individuals who want to generate additional income without dealing with tenants at all.
It’s important to review your home insurance policy to ensure that you have coverage for these rental scenarios. Also, be sure to consult with a real estate professional to ensure that you comply with local regulations and laws governing rental units.