6 ways your house can pay itself off

6 Ways Your Home can Pay Itself off

Once upon a time, buying a house was part of the big Australian dream. We bought into that dream when we were in our early twenties and despite entering the property market early, it hasn’t been a dream to maintain the finances to sustain our dream house. We were ready to buy, but it’s taken a lot of hard work and input from my parents to make the best purchasing choices for our family home. Once you purchase a property, you’re under the contract of paying a debt back for 30 or so years which can sound depressing, but there are simple ways to make your property pay off itself. It’s all about turning your property into an income earning asset while you live in it. Here are 6 ways your home can pay itself off so you can own it sooner.

home can pay itself off

1. Turn unused space into a studio that can be rented out to a student or a single person. There are a number of ways to create a new dwelling in an existing property. For double storey homes it could be as simple as converting or building in downstairs. For single storey homes, why not look at converting a garage.  If you have a large yard, why not set up a container home? There are council regulations that must be abided by if you are to rent out a studio on your property or build a separate dwelling on your land. Make sure you check with your local council on what you can do (the laws are different for each shire), but once these guidelines are met, the income you earn from renting out this space can dramatically reduce your mortgage.

granny flat

Turn unused space into a studio or granny flat

2. Rent out space in your home that you don’t use. We have a double car garage, but only one car so there is a lot of space that we can rent out to someone who requires a cheaper alternative to storing their gear in a storage facility. Check that your home and contents insurance covers your renters goods. To advertise storage space in your home, advertise on space out, gumtree or via word of mouth.

Rent out space for storage for people who go to work abroad

Rent out space for storage for people who go to work abroad

3. Rent out a spare room. This kind of arrangement may not suit everybody, but there are opportunities to house overseas students, university students who have come from the country to the city to study or singles who are happy to share a home. To advertise your spare room, head to Real Estate Share, or for overseas student housing check out Oz Home Stay and Student Housing Australia.

4. Install a vegetable and herb garden. Not only will this save on your food bill because you’re growing your own food, you can sell extras at markets or to family and friends. If you live rurally, set up a front yard vender so passersby can purchase using their spare change. It won’t bring in a lot of money but that spare change can add up over time. You don’t need a big yard to grown your own veggies. We use the side of our house and we have allowed a pumpkin vine grow through our backyard which produced 18 pumpkins all at once. And it only started from a pumpkin seed that was dispersed over our garden from the compost bin.

home vegetable garden

Plant a vegetable garden – this is one side of our house

 

homegrown citrus trees

And the other side of our house where we grow citrus fruit – mandarins, lemonades and oranges

 

home grown vegetable produce

The fruit and veggies we grew ourself

5. Install solar panels. Unfortunately, you can’t get as much money back when you sell your unused electricity, but you can keep your existing electricity bills down by storing the power you bank up to a battery than can be used for your personal use. Power bills are not getting cheaper so whatever money you save from your electricity, can be added to your mortgage. If you installed panels before the changes were made, that income can be directed to your mortgage. Unfortunately for us, we break even because we have high electricity usage.

solar panels on roof

Install solar panels

6. Install water tanks. Saving water is not going to reduce your water bill by very much, because if you study your bill, a lot of what you’re charged is the service to your property, not the water used. However, every little bit helps. Use tank water for outdoor purposes and washing your car. Grey water can also be used in the garden, but check with your local council on the regulations around grey water. The restrictions are based on environmental hazards, rather than being strict for the sake of it. You can check out my post here on more ways to save water and save money.

If you can do just one of these ventures, you might be surprised how easily you can bring in some cash that can be directed to your mortgage which can potentially save you thousands of dollars in interest. It’s amazing how a little can go so far when paying a mortgage.

Do you have a mortgage? Do you have any tips to share that has helped you pay more off your mortgage? What can you do to your existing property so it can make income?

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  • Great tips Bec, I think I will stick to the veggie garden I have enough people living in my house 🙂 xx

    • Yes, a veggie garden would suit your home as well as feed your family. How have you recuperated from yesterday? Is Adam ok? xx

  • Love these tips – we just need a bigger home to implement some of them 🙂

    • Yes, some of them require space. If I were to build, I would incorporate these tips for sure. When we had no kids, we could have done nearly all of them.

  • It’s really scary to think about how long we are in debt for! We’ve got an offset account set up with our home loan and over the almost 5 years we’ve had our current home loan it’s made a significant difference. We also don’t change our repayment amount when rates have been lowered, the little extra also helps. I love your ideas and am going to talk to Scott about putting in a veggie patch this weekend – will just have to make sure our little gardeners stay away from it!!

    • We have an offset account too and it does make a big difference… providing there is money in the offset account! .

  • Fab tips Bec. And here’s another – work bloody hard! lol 😉

  • We have a mortgage but unfortunately with a two bedroom house we don’t have much space to do any renting out 🙂 I like Jodi’s tip! #teamIBOT

  • I’d like to grow veg but working them around the dog is a challenge. And since I’m not the one at home much it would kind of be forced to be my husband’s job. I know some people have rented out spare rooms etc but I couldn’t do that. I have never done a share house and couldn’t start now!

    • We used a chicken fence to keep our dog Bentley out of our veggie patches. And then he got used to them and we didn’t have to fence them off anymore. Share house arrangements are simply an option if you know you could live with other people. x

  • Or just buy a smaller home. We have been in our house for 9 years now and we love it here, but we have since downsized our lifestyles and live with less- a smaller home would have been just as great (and saved so much on energy bills). When I speak to younger people, I say if they can afford it to buy a small investment property while they are still living at home with their parents, and pay that off as quickly as possible. Wish I had done this!

    • Very true Natalie. Hindsight is a wonderful thing. Living within your means is important too and can help with reducing the mortgage because you have a little mortgage to pay off to begin with.

  • Great pointers Bec!

  • Great post Bec, I agree with Jodi – work hard and make sure you pay more than the minimum required and pay often, not monthly 😉

  • We had a spare outside room that we rented out on occasion when in Darwin. It was good to help, but I’m glad we didn’t do it for long stretches. It’s hard having people in your space all the time.

    • It can be hard having someone live in your space, but it’s an option at least that can be a temporary arrangement in order to get ahead or make ends meet. x

  • I am doing number 4 and looking into 5 and 6, just waiting for a bit of extra cash flow for that initial outlay. Every little bit counts.

    • Yes, the last three tips do need cash flow in order to install them, but once done, it’s amazing how much they add back to the cost of living. x

  • Natalie @ Our Parallel Connect

    We are in the middle of doing the first one – lots of work but hopefully it will be worth it #IBOT

    • Great idea Natalie. It can work well for when the kids ever move back into the house if they are older. I know of some parents that have done this and now rent the suite out to others. First dibs are always to family though when needed.

  • Hugzilla

    Aaaah yes, we have the solar panels happening, which was a lovely inclusion with the house we bought earlier this year (I don’t think we would have spent the money to install them otherwise). We have quite a bit of space here so the option to rent out the extra areas is a very reassuring one should we ever need help with the repayments.

    • Yes, it’s a good option to have – and great if you have the space to do it too. 🙂

  • Great advice, Bec. I’m very impressed with your veggie haul. We’re doing well with ours too. Solar panels are a great idea and I love the idea of renting out spare space – if only we had some. Good luck with the comp x

    • It’s amazing what spare space you can find if you were really desperate. And good to hear about the veggie gardens too. We need to get ours ready for Spring/Summer.

  • Getting into the property market early and getting space rented is the easiest way!The hardest part is working your butt off to pay for it. haha! I’m looking forward to building a veggie patch in our garden soon. I think it’s great so many schools grow one for the kids to learn about, my kids are busting for one. Saving some grocery money will be very handy! Nice one Bec x

    • Thanks Jo. Yes entering the market early helps and renting spare space if you can definitely pays off that mortgage quickly.