Rent by room can earn £6,500 more!

Cash-strapped homeowners could potentially earn thousands of pounds of extra income a year, even in the current economic climate, by renting out their properties on a room-by-room basis.

By renting out properties on a room rather than whole property basis, homeowners could boost their incomes by as much as £6,500 a year. And with average property rents continuing to fall, room rental could become even more lucrative as figures show that individual room rates have remained surprisingly resilient to market conditions.

EasyRoommate carried out a detailed analysis of the rental market, comparing average room rentals versus average property rentals on a typical three-bedroom house for towns and cities across the UK (see tables below).

It discovered that by renting on a room-by-room rather than full property basis, in many cases homeowners could significantly increase the amount of rental income coming in every month.

For example, in the North East town of Hartlepool, homeowners looking to rent their properties can potentially earn an additional £545 a month, or £6,540 a year, by renting out the three bedrooms individually to tenants rather than renting the whole property.

In Barnsley, meanwhile, room rental could generate as much as £490 a month, or £5,880 a year, of additional income compared to whole property rental. In the popular seaside town of Great Yarmouth, homeowners could potentially boost their rental income by as much as 80% by renting out their properties on a room-by-room basis.

Across the UK as a whole, the average rental cost of a three-bedroom house in February was £782 per month, according to property search engine, Globrix. The average room rent, according to EasyRoommate, is £375 per month, which means homeowners could typically generate an additional £343 per month if they chose to rent on a room rather than whole property basis.

Of the major cities, Birmingham homeowners are in the best position to reap the benefits of room rental. According to property search engine, Globrix, the average three-bed property in Birmingham rents for £600 a month, while the average rent for a room is £325 a month. This translates to an additional £4,500 a year rental income simply by choosing the room rental route.

Surprisingly, perhaps, for London homeowners EasyRoommate found that the cost differential between renting a whole property or renting on a room-by-room basis was negligible.

The following table shows the top UK towns/cities in terms of the potential extra monthly and annual income homeowners could earn by renting a three-bed house on a room-by-room rather than whole property basis:-

The table below shows the seven major cities in England in terms of the potential extra monthly and annual income homeowners could earn by renting a three-bed house on a room-by-room rather than whole property basis:-