More homeowners turn to lodgers amid cost-of-living crisis

More homeowners turn to lodgers amid cost-of-living crisis

0:02 AM, 17th January 2024, About 3 months ago

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There has been a massive jump in the number of homeowners who are renting out their spare rooms to lodgers with an 89% rise in such listings between January 2021 and January 2024, one flat sharing site reveals.

According to SpareRoom, January is usually a peak month for flat sharing as homeowners try to boost their income after the festive season.

But this year, the situation is more urgent as the cost-of-living crisis and the high mortgage rates in 2023 have put many homeowners under financial pressure.

And the government’s Rent a Room Scheme, which lets homeowners earn up to £7,500 a year tax free by renting out a room in their home, is a lifeline for many.

It also helps to increase the availability of rental accommodation.

‘Living costs have soared’

A director of the firm, Matt Hutchinson, said: “Living costs have soared recently, and the start of the year is always a tough time as people face the financial hangover from the holidays, alongside increased heating costs and bills.

“So, it’s no surprise the number of homeowners looking for a lodger has spiked in the first week of 2024.

“Particularly when you look at how much you can earn by renting out your spare room. You’d have to work a lot of hours in a second job to come close to the income you can earn from a lodger.”

‘Helping to add supply to the rental market’

He adds: “The good news is, all these extra rooms are really helping to add supply to the rental market, which has been in decline for several years.

“If government wants to help both homeowners and struggling renters, they should seriously consider increasing the tax threshold for the Rent a Room Scheme, an incentive specifically designed to encourage people to rent out their spare rooms.

“It’s a real win-win policy, and there aren’t many of those around at the moment.”

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