Make Profit Starting a Business of PG Accommodation

With so many lucrative businesses on offer, PG accommodation is one of the best businesses you may start by letting out your vacant rooms and earn monthly rental income. Most importantly, you don’t need any hefty amount of money to start this business. It is so simple…you can convert your vacant apartment or one or two floors of your house for paying guest accommodation. It has a very good earning potential especially if you are residing very near to college, universities or any other educational institutions. The student population and number of working personnel in various cities give a rise in this thriving business. Isn’t it a lucrative business idea….So continue reading this post and it will take a look at the business of paying guest accommodation.

Some Essential Facts about Starting a Business of PG Accommodation:

Starting a business PG accommodation is quite easy and straight forward. You can easily start this business right from your house. However, there are certain things you will need to keep in mind before starting it.


you will need to ensure that the space for PG accommodation is safe and secure. This is more important if the tenant is woman. The police verification is very important in this case. You should make sure to stick to the standard price of rent in the market. You may need to provide the basic furniture such as: x number of tenant will require x number of beds, double beds or single bed(s), a kitchen that is furnished, x number of cupboards, televisions,  refrigerators, second hand furniture. Many tenants however, bring their own television and refrigerator and also their own utensils. Some apartments can also have air conditions for the tenants.

Second thing

is you should negotiate the terms and conditions at the very beginning. You may offer various services, so the price of the accommodation should be according to the types of services offered. Make sure you offer the same exact services as you mentioned in the advertisement.


you set up a good grade serviced apartment by spending around RS 4000 to 6000 per sq. feet on the interiors alone. For example: for a 250 sq feet room, one is expected to spend around RS.12.5 lakhs. However, for the basic serviced apartment will cost around RS.7.5 lakhs for 250 sq feet room. Those who are the owner of the serviced apartments will usually work together with the companies for a fixed occupancy year wise. The company will pay a discounted fee and also a fixed amount of annual fee. In case there is a separate apartment manager, that manager will get around 10% of the rent, which is collected by the manager. The tax treatment will differ accordingly.


When a house is converted into a PG, it will be considered and treated as a commercial property. The owners will need to pay the utility bills, which include electricity, water and also the taxes, which will be charged at commercial rates. There are certain cities, where one will need to change the normal gas connection to the commercial gas cylinder. Therefore, you should understand that, with the status of the property changing into a commercial property, there will be increase in the overall cost that you will need to accommodate with. You should also make sure to know the responsibilities that will come with the starting of a PG accommodation business.

Fifth thing is,

those who are planning to turn their residential home into a PG accommodation, they will need to get permission and also need to know how to market their business properly. The permission should be taken from the municipal authorities, as concerned and if it is required, one will also need to contact the fire and police department. One more point to be remembered that the building regulations and rules will vary from one city to another and this is why, it is very important to check with the respective local planning office.

Sixth thing is,

The business of PG accommodation can fetch a good amount of income and this will definitely vary from one city to another. For example: in Chennai, it can help one to earn around RS. 3500 to RS.10, 000 per head on a monthly basis. On the other hand, in Bengaluru, the PG rent can start from RS. 2000 to RS.20, 000 per head per month and it depends on the service provided and the apartment itself. In Mumbai, the PG property owners can expect to earn from RS.7000 to RS.50, 000 per head per month. A PG house, in general, can accommodate around 5-6 individuals and one will need to check the rules and regulations of their respective city for the PG, before they opt for the business.

For the advertisement purpose, you can take help of some popular websites directed towards the tenants, such as or any other website as such.

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Start a Business of PG Accommodation
Article Name
Start a Business of PG Accommodation
Planning to convert your home in to PG accommodation? Before leasing it out, learn all the essential aspects related with this booming business opportunity.
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Home Business Ideas Center
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