How to turn your home’s empty spaces into a fuller bank account

Got a spare bedroom, parking spot or shed space? It may help you balance your household budget.

Space is a new frontier for many Australians trying to keep on top of rising living costs.

However, this has nothing to do with stars and planets, and everything to do with spare rooms, sheds, car parks and other storage spaces.

Parking space sharing platform Parkhound says its hosts earn an average $187 monthly, while fellow sharing app Spacer – which helps people rent their spare storage space – says hosts earn an average $198 monthly.

More people are sharing housing space too to cut back on costs, with young adults the hardest hit by the cost-of-living crunch in recent years.

Australian Bureau of Statistics figures show more than two-thirds of households have a spare bedroom, and research by Finder.com.au shows 9 per cent of people with extra rooms are renting them out to others for extra money.

FLATMATE FINANCE

“Living with a roommate seems to be a sacrifice many are willing to make to avoid missing repayments, and alleviate the pressure of rising costs,” Finder head of consumer research Graham Cooke says.

“It’s also a great opportunity to earn extra income on the side if you have the space and the luxury to do so. This can help with covering bills, saving for a bigger goal or simply having more spending money.”

Mike Rosenbaum, CEO of Spacer

Finder head of consumer research Graham Cooke

Cooke says people should understand that sharing housing space means less privacy, so boundaries and expectations should be established.

“Risk of accidental damage, late rent payments and disruptive tenants are all potential pitfalls of sharing your space with another person,” he says.

“A good way to combat this might be having a security deposit and having a written lease agreement.”

However, you don’t need someone living in your space to make money from it.

The CEO of Spacer and Parkhound, Michael Rosenbaum, says more people are renting out their parking spots and storage spaces, prompted by rising living costs.

“Renting out unused spaces provides a relatively low-effort way to generate extra income,” he says.

“This trend is especially prevalent in urban areas where space is at a premium and the rental income from such spaces can be quite lucrative.”

OLDER USERS

CBDs and near-CBD areas are the most popular places for space rentals, and Parkhound says Baby Boomers and Generation X are using its platform more to bolster income, although younger generations still comprise 74 per cent of users.

“Spacer hosts tend to be older than Parkhound hosts … primarily because the concept of renting out storage space appeals more to homeowners who often have unused space such as garages,” Rosenbaum says.

He says passive income is becoming increasingly important for balancing household income and expenses.

“Australians are exploring ways to secure additional revenue streams that require minimal ongoing effort,” he says.

Jess Black earns exra income through Spacer. Picture: Supplied

“Passive income from renting out unused space is particularly attractive because it offers a steady, reliable source of income.

“In recent years, we have observed significant growth in the space-sharing market.”

Jess Black, 42, turned her garage into a revenue-generating asset in 2021 and has been renting out the space for $182 per month, producing more than $6200 so far.

“With rising expenses and the challenge of managing a mortgage, the additional income from renting out my spare space has provided much-needed relief,” she says.

Black says setting herself up on Spacer was “surprisingly straightforward” and she urges others to assess their available space, and their goals and priorities.

“Take the time to de-clutter and organise the space to maximise its rental potential,” she says.

“Also, be clear about your expectations and boundaries with potential renters and communicate openly throughout the rental process.”

MAXIMISE YOUR INCOME FROM SPACE

• Optimise your listing by providing detailed descriptions and high quality photos.

• Research the market rate for similar spaces in your area and price competitively.

• Consider offering discounts for long-term rentals.

• Invest in security measures such as cameras, locks and lighting.

• Be responsive and professional in your communications.

• Offer flexible rental terms.

Source: Parkhound and Spacer

Originally published as How to turn your home’s empty spaces into a fuller bank account