I bought a $1,200 shed on Craigslist and transformed it into a backyard cottage. My side hustle nets me about $600 extra a week.

• Daniel Salas paid $1,200 for a rundown shed on Craigslist and transformed it into a cute cottage.
• Salas spent around $45,000 making it an oasis in his San Antonio backyard to rent out to tourists.

This as-told-to essay is based on a conversation with San Antonio, Texas resident Daniel Salas about his experience purchasing a shed from Craigslist. Salas, a 45-year-old consultant, moved the structure to his backyard and transformed it into a short-term-rental property that rents on Airbnb, Vrbo, and Booking.com for about $75 a night. This interview has been edited for length and clarity.

The first time I got the idea for the shed was when my wife and I stayed at tiny home Airbnb in Fredericksburg, Texas. During the pandemic, I decided to go for it. I saved about $25,000 to start the project.

The shed as Salas purchased it in 2021.      Courtesy of Daniel Salas

In 2021, I ran across this Craigslist ad for a $2,500 shed. It was fairly new, maybe less than five years old. The owner told me there was one catch: "You can't take it apart, but you can have it today for half the price."

The shed being transported in 2021.      Courtesy of Daniel Salas

My wife didn't even know that I made the purchase. I started taking down my fence, and she said "Oh my god, what are you doing?"

The plot of land Salas earmarked for the tiny home. He had to take down his fence to get the shed into the yard.      Courtesy of Daniel Salas

I hired the contractor who had done a total renovation on my kitchen and dining room the year before. Together we did the blueprints and the planning.

The shed on Salas' property, pre-renovation.      Courtesy of Daniel Salas

I got several bids before I decided I wanted to use my contractor. He wasn't even the cheapest, but I got him because I knew his work.

All in all, I probably blew between $40,000 to $45,000. That's including everything, even putting the fence back up.

One of the improvements Salas made was painting the shed blue.      Courtesy of Daniel Salas

I wanted the house to be just a little bit bigger. So we had to blow out the back wall and add a bedroom. That took about an extra four to six weeks from the original timeline.

The bedroom being built. Without the addition, the shed would have been a tiny studio with no separate sleeping space.      Courtesy of Daniel Salas

Building that tiny bedroom was just a lot more work. I had to hire an electrician to reroute the wires, adjust the pitch on the roof, and remove the gutters. It was a little painful, but it was the right thing to do.

The extra bedroom when it was completed.      Courtesy of Daniel Salas

I didn't expect the materials to be so expensive. The price of insulation has gone up two to three times since 2020 — same thing with lumber.

Insulation lines the inside of the shed during the renovation.      Courtesy of Daniel Salas

We completed the project in November 2022.

The shed during the renovation.      Courtesy of Daniel Salas

I've listed it through a management company, Evolve, which takes 10% of all bookings. Right now, the minimum that they have it listed for online is between $75 and $90 a night during the week. Weekends would be $90 to $130.

The finished house is listed on Airbnb, Vrbo, and Booking.com via short-term-rental property-management company Evolve.      Courtesy of Chad Vandenbergh

Source: Evolve

We welcomed our first guests on New Year's Eve. Right now, I'm averaging about $500 to $600 per week in booking revenue.

The backyard outside the tiny home.      Courtesy of Chad Vandenbergh

There's a little patio, a barbecue pit with an outdoor sink, a TV, and string lights. It's a great place for entertainment.

The outdoor entertaining area for people who stay in the tiny home.      Courtesy of Chad Vandenbergh

Our very first visitor was a couple from Houston. Now, I've had people from Los Angeles, Seattle, Florida, Rhode Island, and Canada.

Salas says building out the bigger bedroom was the right choice.      Courtesy of Chad Vandenbergh

My favorite part of the house is the restroom. We went all out! It's a little luxury spot. The vanity mirror is anti-fog and has LED lighting.

The bathroom is Salas' favorite room.      Courtesy of Chad Vandenbergh

My advice to others is don't skimp on furniture. Get quality furniture, because people are going to be using it frequently.

The entryway and seating area in the shed.      Courtesy of Chad Vandenbergh

The biggest surprise to me so far has been the amount of attention that we're getting — and people's reactions. They say, "Wow, it's a lot bigger than we thought."

Guests have access to a kitchen.      Courtesy of Chad Vandenbergh

We wanted to provide as much privacy as possible. So we added an extra entrance on the side of my house. There's a private gate and a path. Many times, I don't even interact with guests or see guests that are staying.

The private entrance, set in the wooden fence with the door open, is off to the side of Salas' home.      Courtesy of Chad Vandenbergh

I love having the shed as a side hustle. We get to meet new people from all over. And the extra revenue has allowed me to pad my savings and take more vacations, like to New Orleans and around the Texas Hill Country.

Salas is proud of his shed-turned-getaway.      Courtesy of Chad Vandenbergh