To become part of the housing-crisis solution, start small. Rent just one spare bedroom to just one person. You’ll start small with six big steps, however.
Some of this may feel overwhelming and stressful. All of it is new and so it is a lot of work. Ban the word “just” from your thinking about this detailed process, as in, “Oh, I’m just renting out a room to a person now.” What you are about to take on is an enormous, life-changing challenge that at times will make you dig deep into your reserves of money, patience, tolerance, and insight. The education this process provides, however, is invaluable. To rent rooms in your house to other workers puts you on the frontline of the massive demographic, economic, and social changes that run through every part of American life right now.
Friends and family who aren’t renting rooms are not likely to be supportive. They mean well when they tell you to just sell your house and buy a small condo. Resist that advice — double-down on turning your house into a business partner. In so doing, you will come out far ahead financially, and even farther ahead of your understanding of humanity.
I grew up listening to my beloved Gramma talk about all the lodgers she had in her big, two-story Queen Anne brick house throughout the Great Depression, so I suppose the concept of making room is part of my DNA. Much of the work felt oddly familiar to me, as it might to any of you who grew up in a house you shared. Rest assured, either way, as you settle into the practice of room-renting, these steps will feel ordinary. Each one will help you reframe the way you see your house and the way you live in it. Your house will begin to feel less like a financial burden and more like a profit to you.
How much of a profit? By the time I had fully monetized my own little house, I was making far more in my work as a room-provider than I was as a part-time college English professor. In fact, I don’t know how I would have made it at all, this last tumultuous decade, without the income from my long-term room rentals.
Here are the first six steps to start.
1. Check with local codes about renting rooms in your house. Oregon is currently short by more than 100,000 rental units. Accordingly, the state legislature recently amended laws to increase the number of unrelated persons you can have in your home as long as you also reside there. According to Wasco County and Hood River City government officials, it is fine for homeowners who live in their homes to rent rooms to several unrelated persons for long-term-rental (LTR). These LTR guidelines are similar throughout the Gorge. Part of the reason there is such a demand for LTR in the Gorge is because so many homeowners are already licensed by the City of Hood River, for example, to rent rooms in their homes as Short-Term Rentals (STR) to vacationers. This column is about renting for multiple months or years to local workers.
Don’t forget to consider parking for your lodger’s car. Verify with the city whether an extra car in front of your house is allowed. Also, consider those who do not drive or own a car. Collect bus/ferry schedules. Familiarize yourself with the time it takes to walk to the bus stop, drive to the ferry, drive or walk to the light rail station, the inner city, the local airport. Be prepared to answer some of those questions when interviewing potential lodgers. Not everyone owns a car these days, although you likely have one. All of these facts are helpful for potential lodgers, so include them in your advertisement.
Caprice Lawless photo
2. You’ll need a lease. The Oregon Month-to-Month Lease (rentalleaseagreements.com/or) is easy to download, copy, and to tailor to your specific needs. If you have any questions about the renting process, take a bit of time and read anything your county housing agency offers about tips for renting property. Don’t be put off by the detail. You are entering a new business and are gathering background information.
3. Discuss with your homeowner insurance agent your rental plans. I purchased an extra rental-property coverage ($78/year) to cover liability and repairs. Many lodgers have their own renting insurance (about $15/month). Their policies cover the loss of their belongings in the event of a flood or a fire.
My extra homeowner/renter policy has been a godsend. When a downstairs room flooded last summer, repairs were covered as was a requisite hotel stay for that housemate until the new hot water heater was installed and damaged flooring was replaced.
4. Upgrade your internet service. My ultra-fast wifi provides a fail-safe connection so that my three lodgers and I can each be using our laptops simultaneously for either working or movie-watching. A wireless connection allows your housemates to work in their rooms, on the front porch or in the backyard. That ease of connection is highly valued by lodgers, as so many work remotely now. In good weather one of the perks is to work outside (more on setting up your yard in a column to follow).
5. Calculate what you will charge for a furnished room: The easiest way to do this is by studying local ads to see what unfurnished rooms are going for in your area. Read through those ads for a few weeks to get a feel for the market.
Furnished rooms demand a higher rent. Add to that rent price $50-$75 because your one-price rent will include all utilities and wifi. By reading through the ads for the furnished rooms, you will get a sense of where you are in that market. Consider what will differentiate your room from those. I always set my rent price a bit below those of the other furnished rooms so that I can cast a broad net and be picky about whom I choose as a lodger (more about pricing in a later column).
The furnished room is essential, for several reasons: First, American workers are more transient than ever, and, perforce, are traveling light. Most are earnest workers looking for a quiet place to sleep at night that offers privacy, comfort, and safety. For many, it is all they can do to keep up with their car payments and student loans, not to mention other increasingly expensive living costs. Part of the win/win you are creating lets them move in quickly with only their clothes, electronics, and personal belongings.
Secondly, it is a matter of control. Once you create that furnished room, those assets stay with you and your business. You can write off the purchase of items and maintenance of your house and yard on your taxes (more on tax benefits in a later column). Finally, renting a fully furnished room leads to a one-afternoon-moving-in day for the tenant, rather than several days of their friends traipsing in and out of your home with assorted, iffy-looking pieces of used furniture, all the while disrupting you and the rest of the household.
Next week: Steps 6-7: Setting up the room and making space in the kitchen.
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The information provided in this column does not, and is not intended to, constitute legal advice. The information herein and links to other websites are to provide readers with general information. Please contact your attorney for legal advice with respect to any particular issue. Views expressed herein are those of the writer, not those of the publication.
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