If you look up the best passive income ideas, you usually find ideas that require starting capital.
For example, popular strategies include investing in dividend-paying stocks or starting some sort of online business.
And, while these ideas are legit ways to diversify your income, sometimes, you don’t have a lot of starting cash to leverage.
Thankfully, there are numerous ways to make money with a spare room, letting you turn empty space into a new income stream.
If you’re looking for ways to make money from your spare room, this is absolutely the guide for you.
Let’s get to it.
How To Make Money From A Spare Room & Unused Space
Renting out things for cash isn’t a new concept. In fact, companies like Airbnb have let people do this with their homes for years at this point.
The variety of options out there is great news for side hustlers however.
Ultimately, if you want to make money renting out unused space, there are more options to do so than ever before!
Looking for other beginner-friendly passive income ideas? Checkout:
- Fundrise – Invest in income-generating real estate starting with just $10!
- Arrived Homes – Invest in profitable rental properties through ArrivedHomes!
1. Rent Out Spare Room With Neighbor
One of the easiest ways to rent out your extra space for money is to use Neighbor.
Neighbor is basically like Airbnb but for storage space.
As a Neighbor host, you can make money renting out unused spaces like:
- Spare rooms
- Parking spots
You get to set your own rental rates as a Neighbor host. Furthermore, you create rules for when renters can come and access their belongings which prevents people from dropping by too often or at weird times.
Becoming a Neighbor host is free, and you get paid monthly from the people who rent your spare storage space.
To make money, Neighbor takes 4.9% plus $0.30 for every transaction, but you’re still making free money at the end of the day as a host.
Many Neighbor listings charge around $20 to $100+ per month, and if you live in a large city, it’s definitely easier to find customers.
Overall, Neighbor is definitely one of the best ways to make money renting spare rooms or other storage space, especially because it’s free.
2. Make Money Renting Rooms
Another straightforward option to make money with a spare room is to rent it out to other people.
Airbnb is the leader in this space, and becoming a host is completely free like with Neighbor.
Most Airbnb hosts pay a 3% fee, but that’s really your only expense here. If you get a handful of bookings per month, that’s easily a few extra hundred dollars in income that’s rather low effort.
Some Airbnb hosts even automate large portions of the process.
While I’ve lived in Dubai and Colombia, I encountered so many scenarios where I checked into my room with a lock box and key and never even met the host.
Furthermore, hosts often hire cleaning staff to tidy up after guests, so there are ways to automate this sort of business.
But even if you rent out a spare room or basement for some occasional extra cash, this is a decent side hustle.
And Airbnb isn’t your only option. Websites like VRBO and Rent Like A Champion also let you rent spare rooms for money or even entire rental units.
3. Turn A Spare Room Into An Office
This is one of the more creative ideas on this list but it’s honestly my favorite and something I’m personally doing right now.
In a nutshell, this idea to make money with an empty room takes two steps:
- Create and operate some sort of business from the space to eventually make money
- Write off some of your office space and business expenses when filing your taxes
You’d be amazed at what this combo can do.
I have two legal businesses, one for freelance writing and one for my media properties.
This is what my at-home office space currently looks like:
But, because I run businesses from home, I can write off business expenses like my Internet and even consider a portion of the space and business space, which has some nifty tax deduction possibilities.
This stuff might sound meaningless, but it honestly adds up quickly.
And all of this from putting a small desk from Ikea in my kitchen and going through some legal steps!
Anyway, the point is, one more entrepreneurial way to make money with a spare room is to run some sort of business from it.
I also like this idea because your online business has way more upside income potential than just renting out storage space or a spare room for some quick cash.
4. Get A Housemate
House hacking is a very popular tactic, and the idea is to bring on roommates to help cover some or all of your mortgage.
This strategy to make money from a spare room has immediate upside; you get a tenant and you’re hopefully looking at 12 months or more of steady rental income unless something goes wrong and the tenant leaves.
The downside to this is you’re now living with roommates, which can create problems if you have different schedules or definitions of what a “clean” kitchen sink really looks like.
Personally, I wouldn’t pursue this option unless I bought a duplex and could rent out a private basement apartment and never really see the other person.
Some landlords do this to great success, and there are actually lots of cool series on YouTube about how to make money with rental units.
This video from YouTuber Shelby Grosch is very insightful and covers the cost and profit breakdown from a duplex he’s living in:
5. Rent To Foreign Exchange Students
Like Airbnb or other rental properties, another way to make money renting out rooms is to rent them to foreign exchange students.
According to Student Room Stay, hosting a foreign exchange student can earn anywhere from $30 per day to $1,400 per month.
This is a massive range, and to be fair, most host families I’ve ever met do it for the experience and to earn some good karma rather than doing it for the money.
But hey, if you can land a paid arrangement and host an interesting student, that’s a win-win!
6. Rent Out An Event Space
One niche idea for making money with space rooms or properties is to rent out the space for events.
- Photo shoots
- Video shoots
- Art shows
- Coworking spaces
Granted, you need a pretty unique or interesting space for most of these ideas to work.
However, I can see a world in which you transform your room into a podcast studio or photo shoot room and find renters on Peerspace, especially if you live in a big city.
In the future, I want to have a home with a room for filming YouTube videos, so this sort of idea is what I want to try down the line.
Peerspace is free for hosts as well, although it takes a 15% fee from bookings which is pretty steep.
7. Grow Or Raise Something
Alright, not that type of growing!
But one super creative way you can make money with unused space is to grow and sell something with the space.
Obviously, gardens are an easy option here, and you can probably save extra money every month by growing more of your own food.
I also have friends who turned unused backyard space into a garden and chicken coop, and they make extra cash by selling eggs.
But you can get super crazy here. I mean, in this Vice YouTube video, one side hustler shares how he makes $45,000 raising and selling fish from his apartment.
This guy has 50 tanks in a one bedroom apartment in Toronto, and he raises 3,000 to 5,000 fish at any given time!
Talk about a wacky way to make money.
Tips For Making Money From Spare Rooms
Now that you know how to make money with spare rooms, let’s cover a few tips you can use to help this passive income idea succeed.
- Explore Multiple Options: There are so many rental platforms out there, so who says you can’t make money with Neighbor, Airbnb, and with several other companies at the same time?
- Track Expenses: A rental business is like any other business, so make sure you accurately track additional income and expenses so you know how much you’re actually making.
- Consider Taxes: As mentioned, certain rental expenses can serve as tax deductions, especially if you’re running a business from part of your home.
Extra Reading – How To Make $500 Dollars Per Day.
Renting out your extra space for money is one of the simplest ways to create a new income source from nothing.
And, if you get creative, there are so many ways to get started.
I mean, people even rent out land for camping or farming, and if some guy can raise $45,000 worth of fish per year in his one bedroom apartment, the sky really is the limit.
Just remember to track your expenses and to experiment with several rental options to drum up as much business as possible!
Looking for even more passive income ideas? Checkout:
Tom is a full-time blogger and freelance writer with a passion for side hustling, passive income, and the gig economy. His work has appeared on dozens of personal finance websites like Money Crashers, The College Investor, Investor Junkie, and more. This Online World is all about providing people with honest ways to make and save more money by using technology. To learn more about Tom, read his About Page!
If you’re interested in freelance writing services or want to partner with This Online World, please use our contact page to get in touch!