More than a third of households who take in lodgers are forced to do so to cover the bills and make up for benefit cuts.
Other reasons included doing a favour for a member of the family or friend (38%), to save money (25%), to help repay debt (25%), to pay off the mortgage (22%) or because the home owner didn't want to live alone (11%), according to research from insurer LV=.
Nearly twice as many homeowners now have a lodger compared to five years ago, with demand so high that the average spare room is being let within just eight days of it being advertised.
Landlords in the Greater London area charge the most for their rooms, with the average cost of a room in the capital now standing at £345 per month.
The next most expensive regions are the South East (£278), South West (£270) and Yorkshire and Humberside (£266), compared to a national average of £250.
However, there are risks associated with becoming a landlord. Nearly a third of landlords (31%) said their lodger simply left without paying what they owe, while another 31% said their current tenant never pays their rent on time.
A fifth (20%) of landlords said they have come home to find appliances, such as the oven, left on and unattended, and one in seven (14%) have had their belongings damaged.
Invalid home insurance
LV= found that landlords are also risking invalidating their home insurance by taking in a lodger. More than half of those questioned (59%) said they didn't always check references about their potential lodger, while 34% haven't updated their home insurance since taking a lodger in.
Selwyn Fernandes, managing director of LV= home insurance, warned: "While renting out a room to lodgers can be a great source of income, homeowners might be unwittingly invalidating their home insurance, leaving property and possessions at risk.
"All those considering taking in a lodger should vet potential tenants carefully and make sure they have suitable insurance in place."