There has been a "lodger boom"in recent months, according to new research from Halifax.

A study from Halifax Home Insurance has estimated that there are 970,000 people renting rooms from homeowners in this way.

It has been suggested that financial concerns are behind the increase in the number of mortgage holders opting to collect landlord rent through this method.

However, those who do decide to develop such a landlord-tenant relationship have been warned about the potential consequences of not following procedures correctly.

Martyn Foulds, senior claims manager at Halifax Home Insurance, remarked: "Getting a lodger in is a great way to earn some extra money to help with the household budget, but it's important to seek advice from your home insurer beforehand."

He added that developing such an arrangement can have an effect on insurance policies, so it is important to let insurance firms know when a lodger is staying.

Professional private landlords were also warned about the importance of insurance recently, with Let Insurance Services spokesperson Malcolm Harrison claiming that rent insurance could be a savvy move in the current economic climate.

Written by Sarah Field

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