Cost of living Australia: How to make extra money out of your home

If you approach the venture with a business mindset, rather than viewing it as just money on the side you can make more money out of your home than you think.

There’s working from home, then there’s having your home working for you as millions of savvy Australians are discovering right under their own roof.

Recent data from Finder’s Consumer Sentiment Tracker unveiled 44 per cent of Australians have a money-spinning gig outside of their regular job – equivalent to 8.8 million people. The most lucrative gig is renting out a room, or a whole home, which 3 per cent of those surveyed are cashing in on.

According to Finder’s research this pursuit rakes in an average of $702 a month.

While short-term accommodation platforms are popular, there are other ways to profit from property – from renting out your pool or lawn by the hour, to leasing your shed or parking space by the week.

The most lucrative gig is renting out a room. Picture: Supplied

The boost to the bank account can be lucrative, however Finder’s personal finance expert, Angus Kidman, said side hustlers should do their homework before diving in.

“Think clearly about the tax implications. Some people get caught out because they don’t declare this money as income. It’s actually in your interest to declare it, because then you can claim some of the relevant expenses,” he said, adding it’s wishful thinking to consider the money as tax-free.

“These are all online platforms, and data matching exists, so you’re going to get caught out. If it’s big enough to make a difference to you, the ATO will detect it.”

USE TAX TO YOUR ADVANTAGE

Income tax is one piece of the puzzle, but short-term rentals can also incur capital gains tax.

“If you’re renting an existing bedroom, that’s probably not going be a problem because you’re ultimately not changing the function of the house. But a granny flat built for an Airbnb business means you’d have to pay capital gains on at least that part of the property because it hasn’t been the principal residence.”

Earn some coin by renting out your yard to a furry friend or two. Picture: Rob Leeson.

EARNING FROM BACKYARDS

Homeowners without room for people can still earn a buck from their backyard with websites such as Spacer for storage. Parkhound for car spaces or SniffSpace, a lawn leasing portal for dog lovers averaging which currently has more than 3500 dog owners signed up.

SniffSpace host Jenny Vandervelden said the pooch offering is two-fold.

“As a long-term dog lover with loads of space, I’m delighted to be able to share my property with dog owners who need a safe and friendly environment for their anxious and shy dogs,” she said.

“I’m providing a service to the community while using the extra income to reinvest in my property.”

Financial success in a home-based side hustle comes down to business acumen and planning, said Mr Kidman.

“Take a look at the competition already in your area. Go on whatever service it is and see what’s around because if there are already a large number of your neighbours renting out their backyards as a dog park or pool for a swim then maybe you’ll may struggle to stand out. That is, unless you’ve got something really unique,” he said,

Keep it clean, tidy and well presented.

“Don’t treat is as just a bit of money on the side, approach it with a business mindset.”

Record keeping, separate bank accounts and realistic expectations all help a bonus business run smoothly according to Mr Kidman.

“One thing people underestimate when running these services from home is the sheer amount of work. Your customers will have high expectations, and whatever the space they’ll want it to be clean, tidy and well presented.

“If you don’t deliver that, you’ll end up with negative reviews and it’s not going to pay off. Remember a side hustle, can be a hassle.”