Pros and cons of lodgers

Rising bond costs due to higher interest rates, combined with rising food and fuel prices, are tightening the screws in many household budgets.

Many homeowners are now having to look at new ways to stretch their budgets and to meet their bond obligations in order to hang onto their properties. One option that could relieve the financial burden is to take in lodgers or rent out sections of their homes.

But it is not a decision to take lightly. Homeowners should weigh the advantages and disadvantages carefully and do their homework. Sharing your home, whether with friends or strangers, can be fraught with obstacles since it may cause disruption to your own household routine and create a feeling that your personal space is being invaded.

However, if it may make the difference between losing or keeping your home, it may be worth the trouble. And there is always the possibility that conditions will improve in future - for instance, interest rates may come down or your own financial position may become more secure, and the arrangement can then be terminated once the rental contact period lapses.

The most crucial aspect of taking in lodgers or tenants is to choose suitable candidates and this is where the help of an experienced estate agent is invaluable. It is imperative to keep the arrangement on a businesslike footing. And having the backup of an independent party that can check creditworthiness, deal with the conditions of the lease and collect the monthly rental will take a lot of strain out of the arrangement.

This may seem unnecessary if you decide to share your home with friends or family members but there is always the danger that your relationship may become stressed if either party does not strictly adhere to the conditions of the lease. It may, for instance, cause friction if family members of friends fail to pay their rent on time and the owner feels too uncomfortable to ask for it.

A local agent will also be able to give good guidance on what a realistic rental in the current market would be.

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