How to Present the Room
NB this page contains some general legal information which is for guidance only and is not legal advice see - Disclaimer.
It goes without saying that the room should be clean, in good (preferably neutral) decorative order, tastefully furnished with at least a comfortable bed, somewhere to hang and fold clothes, and desk or table, including a lamp, and a chair. Also, ensure that any clutter (such as the last occupant's books or posters, or any junk you've being storing there) is removed. If you don't intend to allow the lodger's partner to stay overnight, but I wouldn't normally advise this, consider putting a single bed in the room.
Your home needs to offer private, separate sleeping areas for both the landlord and the lodger - if either party has to go through the other's sleeping space to get to common areas, or regularly access services, it won't work!
To help attract a good lodger, it's an idea to provide at least a basic TV and DVD player - this doesn't need to be particularly expensive - you can get a new HD TV with freeview and integrated DVD for around £100 from retailers like eBay or Amazon, or failing that, look out for secondhand ones for less.
Bear in mind though that whether the lodger brings their own TV or watches one already provided, in the UK, they are liable for their own TV licence (unless they can prove they're a member of your family or are employed by you). This includes streaming live TV programmes (by any broadcaster, not just the BBC) from the internet - see TV Licensing - Tenants and Lodgers.
Use the room to maximise privacy...
If you don't think sharing your home will come especially naturally, the lodger is likely to use your lounge much less if they have a TV in their room and it's as comfortable, attractive and self contained as possible. You will find that most lodgers will want to maintain their own space, preferring to spend their time at home in their own part of the house, at least part of the time. However, unless your lodger really doesn't spend much time at home, and when they are around they never have visitors and you're hardly aware of their presence, you are actually much more likely to come to resent each other if you're strangers, than if you have an amicable relationship. If you find that your lodger is living very separately, it might be an idea to invite them to join you at least once a week.
A clever loftbed (sometimes called a cabinbed) such as that shown below turns the lodger's room into a comfortable bedsitting room (you can typically find models that provide a wardrobe and a desk, as well as some that incorporate a sofa, in addition to the type shown here that simply raises the bed, creating additional floor space). Short of funds? Pick one up secondhand, check eBay. However, ensure that any bunk bed you put in the lodger's room complies with BS EN 747-2:2007 or BS EN 747-2:1993 and fire safety requirements.
Although, on the face of it, it might seem reasonable to simply make your lounge off limits, in practice this is not a good idea. Firstly, you will find that you're not attracting the best people - when I read this on room ads, it rings an alarm bell as I immediately get the impression that the landlord is only taking a lodger on sufferance (OK, so you wouldn't do it if you didn't need the money, but you need to be accepting enough to welcome the lodger and be prepared to share your home to some extent). You will also be forced to lower your rent. Even after lowering your asking rent, you could find yourself with a less than perfect lodger.