“House hacking” uses your current primary residence in such a way as to generate income that offsets your mortgage. Some people rent out space in their yard or garage for storage, others rent out individual rooms, and still others rent an accessory dwelling unit.
Yard or Garage
Some homeowners hack their house by renting out storage space on their property or in their garage. This is a lower-stakes sort of rental situation, as no person moves in—just their stuff. Leasing trailer or RV parking is popular, as is a storage-locker-style arrangement in which renters store items that won’t fit into their own living situation, either because of space or size limitations. Examples of such would-be-renters include college students who go home during the summer, or newcomers to a city who are living in a small apartment while they shop for a house. This type of home hacking doesn’t yield much money, but it’s easy.
You can hack your house by renting out a room, either as a short-term rental or a long-term rental.
Short-term rentals are becoming increasingly popular thanks to AirBnb. Other types of short-term rentals include 30-, 60-, or 90-day leases, which are common for travel nurses, study abroad students, or professors who are doing research for a single month or semester. We’ve known several families who have also needed a short-term rental while they remodel their house.
Long-term rentals (renting for a year or longer) are more familiar to most people. This is a productive way to make use of unused space, and it’s especially valuable after a major life transition such as a death, divorce, or a child leaving for college or the workforce.
If you’re just renting one room in your house, you don’t need to go through a permit process.
Seattle recently changed the laws that regulate “accessory dwelling units,” which opened up a new home hack. ADUs, or DADUs (detached accessory dwelling units) are separate living spaces within a single-family property. Think of a finished basement with its own entrance, or a mother-in-law suite, or a garage converted into a studio apartment, or a backyard cottage. You get the idea.
You’ll have to contact your county and/or city to figure out the necessary permits if you want to pursue an ADU or DADU house hack. However, the red tape is usually worth the trouble—renters are willing to pay more for a separate living space, and you also get more privacy. Win-win.
If you have any questions or want to learn more about how to house hack, please don’t hesitate to reach out. We’re always happy to share ideas and help people progress in their home ownership!