5 Things to Remember Before Converting Your House into a PG

Turning your property into a Paying Guest (PG) accommodation can be a lucrative source of income, especially if your home is near a college or business hub. However, it's not as simple as just putting up a sign. Here are five crucial things you must consider before you start.

1. It Becomes a Commercial Property

The moment you start running a PG, your property is reclassified from "residential" to "commercial." This has significant financial implications:

• Higher Utility Bills: Your electricity, water, and property tax bills will be calculated at much higher commercial rates.
• Commercial Licenses: You will need to obtain specific licenses from your local municipal corporation to operate a commercial establishment.

2. Legal and Safety Compliances are Mandatory

Running a PG is a business, and it comes with legal responsibilities. You must ensure you have the following:

• Police Verification: It is mandatory to conduct police verification for all tenants. Failing to do so can result in legal penalties.
• Rental Agreements: Always have a written rental agreement for each tenant, even for short stays. This document is crucial for resolving any disputes.
• Safety Measures: You are responsible for the safety of your tenants. This includes installing fire extinguishers, secure locks, and ideally, CCTV cameras in common areas.

3. Furnishing and Amenities

Tenants expect certain basic amenities in a PG. You'll need to invest in furnishing each room. The essentials include:

• A bed and mattress
• A wardrobe or cupboard for storage
• A study table and chair (if targeting students)
• Fans and proper lighting

Additionally, offering services like Wi-Fi, laundry, and meals can allow you to charge a higher rent and attract more tenants.

4. Setting the Right Rent and Rules

Research other PGs in your area to determine a competitive rental price. Your pricing should factor in the location, the amenities you offer, and whether the room is single or shared. It's also vital to establish a clear set of house rules regarding cleanliness, noise levels, visitor policies, and timings to ensure a peaceful living environment for everyone.

5. Increased Responsibility and Time Commitment

Managing a PG is a hands-on job. You'll be responsible for handling tenant complaints, maintenance issues, collecting rent, and ensuring the property is well-maintained. If you're providing food, you'll also need to manage a cook and kitchen supplies. Be prepared for a significant increase in your day-to-day responsibilities.