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The £85 billion potential of our spare bedrooms

28th August 2013 Print

Around 20 million homeowners in the UK have at least one spare room that isn't being used every night, meaning they could be missing out a combined £85 billion in rental income, according to research from financial solutions provider All About Money.
Based on the maximum annual tax-free earning of £4,250 per bedroom rented out, each homeowner could raise just over £350 per month by taking in a lodger or housemate.
Of course, homeowners with more than one spare room stand to earn even more - although any rental earnings above £4,250 per year are subject to income tax (i.e. 20% for basic rate taxpayers).
"It's nice to have a spare bedroom for when guests come to stay," said Ian Williams of All About Money. "But having unused rooms could also mean a lot of wasted money.
"Renting out a bedroom can help to bring your household income up dramatically, which could really help when it comes to paying the bills or saving for the future. It could also be an option if you're struggling to pay the mortgage on your own and could do with an additional source of income."