The rental market is getting more and more crowded for those considering property investment, with around 1.7 million Britons now taking a lodger. Research from Santander Mortgages revealed nine per cent of homeowners have been forced to rent out a room, up from six per cent in 2011. This extra income generates an additional GBP 3.3 billion per annum for renters - an average of GBP 164 per month for each recipient.
With nearly three quarters (74 per cent) of homeowners having at least one spare room in their home that is either rented out or has no-one living in it, people could be sat on something of a gold mine. Just 26 per cent of people have no unoccupied rooms in their house. This means there is a potential for Britons to make a collective GBP 38.9 billion in rental income. Nevertheless, nearly nine out of ten with a spare room choose not to rent it out.
Of those that opt to take a lodger, 35 per cent do so to help out a friend or family member. Eleven per cent rent a room to meet mortgage payments and outgoings, while 15 per cent need the money to supplement disposable income. In London, 19 per cent of those with a spare room rent it out. However, the practice isn't as popular in the east of England, with just seven per cent of those able to take a lodger doing so.
Of the 34 per cent of homeowners nationwide that would consider renting out a room, 18 per cent would do so if they needed financial help, while 23 per cent would rent if a friend or relative needed it. Eleven per cent would take a lodger if they could find an appropriate tenant, while six per cent would be convinced if they could make decent money from it.
Phil Cliff, director of Santander Mortgages, commented: "The 'rent-a-room' trend is clearly on the rise as the squeeze on the cost of living drives homeowners to look for ways to supplement their disposable income and cover their mortgage costs. There is clearly still plenty of scope for this market to expand, as homeowners with unoccupied rooms put their property to work by renting rooms to friends, family or tenants."
- Thursday 14 November 2013