The number of people taking in a lodger has almost doubled over the past few years as more people seek ways to supplement their incomes, according to a new study.
Research by insurance firm LV= found that the average spare room generated homeowners more than £3,000 in rental income a year.
There is no shortage of demand for lodgings and in Yorkshire and Humberside it typically takes just eight days for homeowners to fill a spare room, the study found - the same figure as found on average nationally.
And where lodgers have been taken on in the region, the arrangement was generating an average monthly income of £266 and an annual income of £3,193 for the homeowner.
Those profiting most from renting out a spare room were in London, where the average annual income exceeded £4,000.
While the arrangement works for some, it has left others with the headache of lodgers fleeing without paying and others causing damage. The insurer is warning those who do take on a lodger to be properly prepared.
Vetting any potential tenant and ensuring there is adequate insurance in place should be high priority for any homeowner thinking of taking in a tenant but many take a blasé attitude to letting, LV = said.
Almost six in 10 (59 per cent) said they do not always check references and a third (34 per cent) had not updated their insurance since taking in a lodger, potentially leaving themselves out of pocket should the worst happen.
Selwyn Fernandes, managing director of LV= home insurance, said: “While renting out a room to lodgers can be a great source of income, homeowners might be unwittingly invalidating their home insurance, leaving property and possessions at risk.
“All those considering taking in a lodger should vet potential tenants carefully and make sure they have suitable insurance in place.”
The survey involved 400 UK homeowners and revealed that a fifth of lodgers were aged between 36 and 50. In total, around 2.7 per cent of homeowners rent out a spare room, compared with 1.4 per cent in 2009.
The cheapest rooms for lodgers are in the Midlands and North West at just over £2,400 a year.
Getting a good rental income is the main motivation for renting out a room, LV = said, and 34 per cent of landlords use the rent from their lodger to help with the bills, 26 per cent to grow their savings and the same proportion said they took in a lodger to boost their disposable income.
Negative experiences noted in the study included that one in 12 landlords were owed rent by their lodger or a previous tenant and on average were £307 out of pocket. Nearly a third (31 per cent) of landlords owed rent said their lodger simply left without paying, while the same proportion said their current tenant never pays on time.
A fifth of landlords who currently have a lodger said they had come home to find appliances, such as the oven, left on unattended and 14 per cent have had their belongings damaged. Homeowners do not always protect against such damage, with less than half (44 per cent) asking for a deposit. The majority (79 per cent) of those who do not ask for one say it is because their lodger is a friend or relation.
One in six have noticed that windows have been left open while the home was unoccupied, and one in ten say their home was not locked properly.
In a separate study into “space-starved” homeowners carried out by the Post Office, almost one in three parents were found to have sacrificed the largest bedroom in the house to their children.
Thirty-one per cent of adults living with children under the age of 18 said they have moved into a smaller room themselves to allow their offspring extra space.
John Willcock, the Post Office’s head of mortgages, said: “With the average house size continuing to shrink, and with many family homes often lacking a garden, it’s hardly surprising that so many of us are concerned about this lack of space and the impact it will have on our children.”