Rooms to Spare? Here’s Your Step by Step Guide to Running a Homestay

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Have your children moved out leaving you lonely in a big empty house? Do you find time hanging on your hands post-retirement? Here’s a step by step guide to running a homestay from the very comfort of your own home.


Homestays are the new global trend that is transforming the way people take vacations all over the world and India is not an exception. Exciting and interesting for both the visitor and the host, homestays are economical, interactive and provide the best way of experiencing the local flavor of a place compared to impersonal and expensive hotels.

What is a Homestay?

Wikipedia says: “Homestay is a popular form of hospitality and lodging whereby visitors stay in a house or apartment of a local of the city to which they are traveling.” The Indian government classifies an establishment as a homestay or bed & breakfast (B&B) if the owner/s of the property is physically residing there and has a minimum of one and maximum of five rooms available to rent.

What Makes Running a Homestay an Attractive Option For Seniors?

It’s a dream job for many – young and old alike – to run a homestay or B&B and host travellers from around the world. But it may be a particularly good option for active seniors who:

• Have at least a couple of rooms to spare in their home, perhaps because their children have moved out
• Have time on their hands post retirement
• Like to socialize and interact with new people
• Could use some extra income
• Do not have much money to invest in starting a new entrepreneurial venture

But the most important thing to know is that a homestay is different from a hotel. You will be sharing your home, food and lives with the people who come to stay with you. It is the personal touch and interaction that differentiates a homestay from a hotel. So right off the bat, if you are not a people person, reject the idea of running a homestay.

The interiors of the homestay Svarg

Where Should You Set Up Your Homestay?

Do you want to sell your city home and reinvest in setting up a homestay outside the city because you’re tired of the pollution, traffic and noise? Or do you want to stay where you are and host visitors who may enjoy the many attractive sights your city has to offer? As for the kind of property needed, take a look at some of the homestay listings on the internet – people are running homestays from their homes, bungalows, farmhouses and even flats.

Namita Bhatia, 55, shuttles between Delhi and Naggar in Himachal Pradesh where her partner Shams Kabir stays full time to run their homestay called Svarg. On the other hand there is the very successful Granny’s Inn, run by Aruna and Asha, both in their 60s, in the bustling city of Varanasi. They wanted to maintain the mansion one of them inherited and thought setting up a homestay would be the ideal way to do it.

How Much Money Do You Need To Set Up?

Nagesh Hodachalli, 71, who runs a homestay on a coffee plantation in Sakleshpur, Karnataka, says, “All you need is 2-3 spare rooms and hardly any investment.” Adds Praveen Khanna of Silver Oak Farm homestay at Nandi Hills, Bangalore: “You’ll need money to buy some good linen and invest in updating the bathroom fittings, and you should be all set!”

Besides these basics, your costs will also depend on the amenities you want to offer and the staff you hire. Says Nagesh, “Ours is a real homestay, not the resorts that young people are building these days and calling homestays. At our place, guests stay in the main house and we barely have any staff. My wife and I serve the food ourselves in our own dining room, not in a separate hall. These days people are providing all kinds of fancy things like dancing and campfires in the name of homestays. That is not what they are meant to be – serving varieties of foods like in resorts. Homestay means living with the family and eating what they eat – good food.”

While this may be true if you are converting an existing property into a homestay, the cost can run into crores if you are buying land and putting together the infrastructure. For example, Praveen and Meera Khanna bought Silver Oak Farm and designed and constructed their residence to serve as a homestay. They had to spend on getting the infrastructure up and running, hire and train staff, and furnish the guestrooms comfortably.

Silver Oak Farms, at the foothills of Nandi Hills

But What About The Paperwork?

Based on the facilities they provide, homestays are evaluated and classified into different categories by the different states in India. For instance, homestays in Kerala are classified as Silver, Gold and Diamond but in Rajasthan there are only Silver and Gold categories.

Rules have changed since the early days now when homestay applications were handled at the state level; district level offices will accept and process applications, cutting time and cost for those in small towns and villages looking to set up homestays. After the application is submitted, district government officials arrive for a surprise visit and evaluate and rate the facilities being offered. Most states (there are some exclusions like Tamil Nadu) do not consider homestays to be commercial establishments and therefore do not levy commercial, luxury or service taxes. Since a homestay is considered a private residence there are no extra electricity charges or water tax either.

Although the application and registration take only a couple of months and you can start running your homestay, the entire paperwork completion process can take longer. Some states like Karnataka allow application papers to be uploaded online.

How To Spread The Word and Market Your Homestay

Set up a website with a good description and pictures of your property. Then get friends and influencers – like journalists and travel bloggers – to come try it out. It will help put the word out`

You can also get in touch with sites like AirBnB and Stayzilla and Homestays of India and have yourself listed on their sites. However, although this will mean higher occupancy, you may not be able to pick and choose the guests you decide to host. It also means sharing what you earn with these sites.

“We rely on word of mouth, no marketing. Why should I pay others a commission when I can get enough guests through word of mouth?” asks Nagesh.

But, says Namita, “We prefer word of mouth only so we can have an exclusive clientele. I don’t need people here who eat their food and use the curtains to wipe their hands. But word of mouth has its drawbacks compared to advertising. You get fewer clients obviously so you need deep pockets to tide you over the low season.”

Praveen Khanna says Silver Oak Farm received a huge launch because a respected Bangalore newspaper wrote a half-page article about it. So it would do well to invite some local journalists over to stay and check the place out personally.

The marketing for Granny’s Inn is handled by Asha’s daughter Shilpi and son-in-law Manish. For seniors who feel technology challenged, it may not be a bad idea to enlist the help of some young family member or marketing expert. The payback from having full occupancy most of the time may make the investment worth it.

How a homestay is different from just renting a room and how to run the perfect homestay

“It is your unique hospitality and the quality of your home cooked food that make the homestay experience different from a hotel. We treat everyone who comes here as our personal guest and make friends with them and their children,” says Praveen. His wife Meera is known for her excellent cooking, the jams and jellies and pickles she whips up (and which they sell too), and everything they serve is fresh and organic from their own farm. They also offer farm tours to their visitors.

Granny Asha pampers and takes care of her guests in ways that no resort owner would. One of her guests from Spain came down with the flu and Asha whipped up her signature turmeric milk with herbs. The sisters, especially Asha who’s more active among the two, make great role models for senior entrepreneurs. They supervise every aspect of Granny’s Inn, making sure that the rooms are clean, the laundry done, small details taken care of and the food cooked to everyone’s satisfaction. They even take their guests shopping for Benarsi sarees sometimes!

Challenges and how to deal with them

As with any business there are some challenges to running a homestay. If you’re located in a remote area you will need a system in place to get your supplies. Says Namita, “You can set up a homestay in a place like ours in Himachal as long as you are really fit and healthy. But as you get older, there will be many challenges. For example, we are 20 minutes from the main road and have to climb up and down through the jungle to get our daily needs every day. But I do know other people, like a 70-year-old in Palampur, who runs a beautiful homestay – so it’s not impossible if you’re organized and have good help.”

Other challenges could be:

1. Security. Make sure you have a CCTV at the reception. Keep records of guests’ identity proofs as a precautionary measure.
2. You may have unexpected visits from local bodies that are unaware of government rules. So be very clear about official procedures and keep all permissions and paperwork with you at all times.
3. If you have to deal with unruly guests and troublemakers, remember that you have complete right to ask them to leave – a homestay is a private property, not a hotel.

Asha and Aruna of Grannys Inn

However, the most common challenges people associate with seniors running a homestay are that the elderly will lack energy, not be able to handle the pressure because of health issues, be old fashioned in their thinking, and face technology challenges in handling marketing and promotion, etc. But the super grannies of Granny’s Inn, Varanasi, have proved everyone wrong with their zeal. They make up for their lack of youthful energy and compensate instead with their compassion, perspective, mental strength and wisdom. They don’t let small ailments stand in the way. In fact, they advocate Ayurveda and have made it a life style, ensuring the food their guests eat is healthy.

But it is not as if age does not take its toll when it comes to running a large and busy homestay. Praveen Khanna, who is 76-years old now, says 55-60 was the perfect age to begin. Now, he feels he is losing steam and consequently the couple has made adjustments to the running of their homestay by accepting guests only if they come as a group of minimum 10 adults.

Rewards of running a homestay

From bringing purpose to one’s life, broadening one’s horizons, keeping one active and engaged, running a homestay can be ideal for seniors.

Nagesh says: “If you can do it, go for it. It is a pleasure for us to serve guests, give them good local food, show them our traditions. It is just like having guests at home, except that you charge them money and make some income in the process.”

And finally, as Praveen says when wrapping up his conversation with us, “The biggest benefit is that you never feel lonely. We have had the finest people come by here, we have built relationships, and very often they leave, giving us a hug.”

About Author

Nishi Malhotra

Nishi Malhotra is a versatile, creative and experienced writer and editor. She has worked for The Better India, Times of India and the World Bank, including a brief stint at Silver Talkies in the past.