Making money from your home
Make $$$ from your home - It’s not just about selling lemonadeBy Barry Lebow (or Frances O’Flynn)
If you’re reading this column, chances are it’s been awhile since you sold lemonade from a stand in front of your house. But entrepreneurial spirit never dies. So here are some grown-up ideas for making money from your home.
Empty nesters, for example, could rent a room or basement suite to students. Even better, by carefully screening potential applicants you could find a student who’s sufficiently trustworthy to leave in charge of the house while you’re away. Or he or she might volunteer to help with household chores in return for a reduced rent.
And what about that garage you don’t use? You could always rent it as a parking spot, but you could also clean it out and rent it to someone who desperately needs storage space or a place to work on a hobby such as restoring old cars. If you are considering renting out the garage or basement for storage, why not take it one step further and offer shipping supplies. Small home-based industries seldom have the space to store or pack their products for shipping.
Here’s a way to make money from Canada’s role as Hollywood North. Film companies comb local registers and scout neighbourhoods looking for just the right place to serve as a backdrop for their movie. You can register your home with the local film liaison office. One acquaintance made over $1,000 a day renting his upscale property to a U.S. film company. They put the house back exactly as they found it, and aside for the inconvenience of having to vacate the premises for the duration of the shoot, nothing was lost, broken or stolen. Added bonus: you’re may just catch a glimpse of your favourite star.
For those with a now empty in-law suite, why not consider renting out the kitchen to a catering company or other food prep organization? You also could rent a basement room as a photography darkroom or a soundproof garage to local musicians for practices.
Don’t overlook the garden. You can grow vegetables, flowers, even turf, on the back 40 and sell the results online or through local landscapers.
Then there are the home-based businesses: bed & breakfasts (particularly in demand in tourist areas); baby sitting services or daycare; pet boarding; esthetics; music lessons and tutoring; antiques (great if you have an old barn or large shed on your property)… the list could go on and on.
For entrepreneurs willing to take risks, there are opportunities in buying real estate as an investment. Many now-millionaires started life with one duplex, living on the top floor and renting the lower. With your expenses paid by the renter, you can buy a larger duplex or a triplex to rent out. The secret, says one wealthy entrepreneur, is to make sure there is money in your pocket after you’ve covered all your expenses. When you’re assessing an investment, determine whether the rent you can charge will pay not just for the mortgage but renovations and maintenance, property taxes and utilities, as well as a certain percentage set aside for potential vacancies and bad debt. Then make sure that still leaves with you a small profit.
Ask the seller for documentation (or rent rolls) which will tell you how much each unit is rented for. You can even ask for past rent history. Then check going rates online or in newspapers. Rents shouldn’t be too high (which discourages renters) or too low (‘there’s something wrong here’) for the area.
Finally, for empty nesters who are reluctant to sell the family home, why not rent it and downsize to a condo or smaller home? This has the advantage of maintaining the home in the family (perhaps the kids will want to buy it from you when they’re settled and more financially secure). It also has the disadvantage of making you a landlord. Depending on the tenant, the condition of the house, the area and a whole host of other factors, you may be taking on midnight phone calls, angry neighbours and potential damage to the building.
Other downsides of making money from your home: Government regulations affecting home-based industries may make it hard to set up a pet-boarding facility or catering kitchen. Parking for customers may be a problem for home businesses such as esthetics. Film companies, and particularly ad agencies who want to film commercials in your home, may not be scrupulous about returning the house to its original condition. Tenants could damage your property. Students could be noisy.
But then, even selling lemonade from a stand in front of your house years ago probably violated some health regulation. It didn’t stop you then. Will it now?
This information is brought to you by your Accredited Senior Agent, a specialist in the housing needs of older adults. Your ASA is an experienced real estate professional who has graduated from a special education program focusing on the needs of seniors. For information, please visit www.thesenioragent.com or contact, Barry Lebow, President and Founder, Senior Housing Council, The Real Estate Academy Inc., providers of the Accredited Senior Agent designation, 416-784-9806 ext. 107