Many people have been hit hard by the double impact of Brexit and the pandemic. If you or your partner were put on furlough or made redundantly, you may find yourself in a tight spot, financially speaking. With less money coming in but the same amount going out, how can you plug the gap?
Homeowners have the advantage in that they have a bricks-and-mortar asset that they can draw on if the need arises. No, we’re not talking about selling up and cashing in, though that could of course be one of several options you may wish to consider. However, if you have no desire to move home, all may not be lost. Treat your home as an investment and consider ways of increasing the financial return you get from your property asset. Here are six useful suggestions on how to approach this.
1. Take out a loan
Assuming you have some equity built up in your home, you should be able to borrow against it. Usefully, a personal loan secured against the property will carry a lower interest rate than an unsecured loan. If your job has not been affected by COVID-19, you can also look into remortgaging the house to generate extra funds. And once you’ve reached the age of 55 years, you may be eligible for equity release, with a Lifetime Mortgage that doesn’t need to be repaid until you move into long-term care or pass away.
Whichever investment vehicle you utilise to take out a loan against your property, you’ll get a lump sum payment that you can use as you see fit.
2. Generate your own electricity
You’ve no doubt heard the phrase that ‘you have to spend money to make money’. One way to do this using your property asset is to invest in a solar rooftop array. Producing your own energy in this way reduces your dependence on traditional fossil fuels such as gas and oil, and lowers your energy bills as well as your carbon footprint.
What’s more, you could make a financial return from your investment in home-grown energy, either by being paid for exporting the excess energy you generate or via the government’s Renewable Heat Incentive.
3. Rent out car parking or storage space
Is your property located near a railway station or a major entertainment venue? Commuters and visitors will be looking for easy parking nearby, so if you have a garage or drive that you’re not using, there’s money to be made. Websites such as JustPark, Parklet and YourParkingSpace bring together supply and demand to facilitate long-term rental agreements.
Similarly, if you have storage space available in your attic, garage or shed, you can advertise availability on sites such as Storemates and Storenextdoor. Charging just £10 per week for 15 square feet of storage could net you £520 per year.
4. Get a lodger
If you don’t mind sharing your private space with a fee-paying stranger, renting out your spare room to a lodger may bring in useful additional income. The government’s Rent-A-Room Scheme allows you to earn up to £7,500 tax-free from letting out furnished accommodation.
Then there’s the rental market for foreign language students and other short-term homestay guests. Strongest during the summer holiday season, these paying guests may require a more active welcome and if you’re prepared to offer additional English language tuition, this could turn out to be a nice little earner.
5. Holiday letting
Becoming a landlord can be a great way to combine your need for additional income with the enjoyment derived from meeting new people. Had you considered short-term lets by renting out the spare room on Airbnb? You could even make your entire home available for rent while you go on holiday.
Your new acquired flair for hospitality could even open up a whole new career path by turning your home into a B&B. You don’t need a licence or qualification as such to run a B&B unless you are planning to serve alcohol or play music, but your property will need to comply with fire regulations, health and safety laws and fire regulations. You will also need public liability insurance and register with HMRC for tax purposes.
6. Photo and film shoot location
Distinctive homes are always in demand for film sets or on-location photo shoots. Properties in London and around the M25 have the advantage in terms of location. The right property in the capital can fetch up to £2,500 for a big-budget film. Be prepared that the film crew may well take over your home for a few days, but it’s an inconvenience that is extremely well remunerated.
If you are interested in pursuing this income stream, register on sites such as Lavish Locations, Shootfactory or The Beach Studios to advertise your property within the glamorous film and photo industry.
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