Most Recent Home Buyers Are Open to Renting Out Their Home, According to Realtor.com Survey
In today’s sharing economy, recent homebuyers are overwhelmingly open to using their home as a way to generate income and offset expenses, according to new research from Realtor.com.
Realtor.com’s latest survey found that while many owners are using traditional methods such as taking on a roommate, some are also employing more creative tactics when it comes to generating income from their home, such as renting out their outdoor space or parking spot.
“As the next generation of home buyers has embraced ridesharing and short-term rentals, it’s a natural next step that they begin to think of their biggest asset — their home — as a potential income stream,” said George Ratiu, manager of economic research, Realtor.com.
Ratiu continued, “For people looking to take advantage of the sharing economy, in addition to traditional approaches it may be worthwhile to explore creative solutions, such as listing your home as a vacation rental when you leave town, or renting your outdoor space or pool. Even a small amount of income each month can multiply over a year or more and can turn into bigger returns.
The survey of 3,026 consumers, which was conducted online by HarrisX in July 2021, found that:
Sixty-nine percent of recent homebuyers would rent out part of their home if it had a separate entrance, kitchen and bathroom.
Thirty-two percent of consumers have already rented out a room, space or outdoor feature of their property, most commonly taking on a long-term roommate (10%) or renting a room on a short-term basis such as on Airbnb (8%).
Creative rental solutions that consumers have employed include:
Renting outdoor spaces such as a parking spot (7%), or a yard/pool (6%).
Six percent of those surveyed have rented their whole home while they were away and 7% have lived in a smaller unit on their property while renting out the main house.
Consumers said that the biggest reason to rent out part or all of their home was:
Extra income to save (53%), extra spending money (37%), to lessen the burden of general monthly expenses (35%), to offset major home expenses such as the mortgage (29%), and to cover a family vacation (16%).
Rental preferences among homeowners include:
Fifty-two percent of consumers would feel comfortable renting a part of their home that has its own entrance, kitchen and bathroom to someone they already knew, 30% would be comfortable as long as they could vet the renter and 29% would be comfortable with a renter that was vetted by a third-party, such as an app.
A surprising 16% of people would rent a space to anyone if they really needed the money.
Recent buyers were less picky about vetting, with 32% saying they would rent to someone they know and 23% being open to anyone.
Among all respondents, long-term renters (24%) were preferred to medium-term (21%) or short-term renters (18%).
“It is important to keep in mind that while today’s sharing economy may make it sound easy to make rental income off of your home, there are many factors to consider before taking the leap. You should familiarize yourself with tenant rights in your state and locality, and understand any community restrictions. Along with those, making sure that renters have been properly vetted and that home insurance will cover any potential damage, are additional things to look into before inviting renters into your home,” said Ratiu.
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