Peer-to-Peer Renting: Lease Your Stuff to Strangers, Hopefully Buy Less Stuff

Recent articles in the New York Times and BusinessWeek magazine talked about the growing emergence of websites where individuals can rent out their belonging to other strangers, coining the new term “collaborative consumption”. I like the idea. Not only can you make some extra money renting out your stuff when you aren’t using it, but as a borrower that means you need to buy less stuff as well. In addition, people can use it as a “test-drive” to try out things like a certain model car or an iPad. Here’s a list of websites in this area, please let me know any that I’ve missed.

RelayRides
Peer-to-peer car rentals! Rent your car to strangers by the hour. Started in Boston and now available in San Francisco Bay Area as well. Free to join, and renters start with $25 free driving credit. Prices are cheaper than competitors like ZipCar, which owns their own private fleet. Claims that owners can make $250 a month on average renting out their vehicles. Rates include gas and insurance.

Similar: Spride Share (currently in SF Bay Area), WhipCar (UK),

Airbnb
Rent out extra rooms in your house (or the entire house, a castle, or private island…). Free to sign up. Set your own prices and availability. Airbnb facilitates all bookings and financial transactions. They already have over 50,000 properties in 10,000 cities.

Similar: ParkatmyHouse (rent out driveway or garage space in crowded areas)

Zilok
Technically you can rent out anything on this site, but it has specific categories for cars, vacation sites, power tools, and event rentals. You can rent from businesses or individuals. Looks like a PS3 is going for $20-$25 a day.

Similar: SnapGoods (newer, but more polished website), Rentalic

Share Some Sugar
Can I borrow a cup of sugar? You can also rent out anything on this site, but SSS seems to promote borrowing between people in the same neighborhood for free (with a refundable security deposit). After browsing a bit, I realize that I could use a lawn aerator, if only there was someone nearby with one available.

Similar: ShareZen (more for collaborative ownership of a plane, home, or boat), Skyara (a marketplace for “experiences”)

I suppose the main concern would be either theft or breakage of your property. Most sites have a user rating and feedback system similar to that of eBay, as well as security deposits. The car rental agencies do provide insurance, but I don’t believe the other sites do. In many cases, you can restrict your lending to members of your social network of friends via sites like Facebook.

Of course, the hardest thing about these sites is often getting the critical mass of adequate inventory to rent out to interested customers. Let’s hope one of these gains some traction. The one I want to use right now would be ParkatmyHouse. Combine their inventory with a real-time iPhone/Android app, and you could search for cheap parking almost anywhere. If you live where parking is scarce, you could profit from what is usually just a headache.

Comments

  1. vijaianand says:

    I been trying out Neighborgoods.net which is similar to many other you mentioned. I didn’t get lot of response. As you mentioned, it needs some traffice and lot of participation to get this sites really make worth the time and money. Otherwise it would yet another project but never clicked on. There are lot of issues involved. What if the borrower broke something and said its already broken and so forth? Not many people want to give security deposit .. Small issues might stop some one from trying this out..

    Let see whether someone wants my lawn mower.

  2. Newlyfrugal says:

    I’m not interested. Too many possible bad scenarios. I don’t want anyone driving my car and abusing it for a few hours or a few days. I don’t even trust my family and friends with my own things, so how will I trust strangers who can turn out to be all kinds of criminals? This might be a good idea for some, but it’s NO THANKS for me.

  3. Looks like it’s generally a good deal for the lender (assuming the proper security deposit, etc.), and an acceptable deal for the borrower.

    Just look at your PS3 example. I could go buy a PS3 right now, and rent it for two weeks and have it paid for. Rent it for a month and I’ve got a second one paid for (just for me :-))…

  4. Greg,
    Just because you are willing to rent it for a month doesn’t mean somebody wants it. More likely 3 people rent it from you in an entire year, and one of them breaks it or steals it.

    This seems like it could be a lot of hassle. Some like the parking one and the housing rentals seem reasonable enough.

  5. We used Airbnb to rent a flat in London in March this year. It was rather an interesting experience. The flat was very modest, but it was centrally located and convenient location. Given this is London it was not too bad for the money paid ($95/night). However, it ran out of electricity on our last night there. Evidently the electricity was on some metered system that the owner did not put adequate money in. She sorted of warned us about it, but also assured us that it won’t run out. I’ve never seen this in any place. We ended up getting dressed and packed for our early morning flight in virtual darkness. If it wasn’t for the light casted through the windows from the hallway, it would have been total darkness.

    It was not quite a London experience we were looking for, but it made an interesting story to tell. In any case, I think Airbnb was a good option to the hotels. I would use it again in the future.

  6. Would these transactions be taxable as income (assuming you make any…)?

  7. That is 100% correct what newfrugal said, a company named [JustShareIt] (1-855-SHARE-00) which has done extensive research on various sample groups and found that people are less likely to share their highly priced assets such as car with family, friends or strangers because of fear, trust, security, safety and many other reasons. That is why this company created a unique platform (hardware and software) which can eliminate the fear, trust, security etc. from owners and borrowers and makes sharing safe & convenient. Due to the changes in law and environment concerns this industry is definitely emerging and I feel that you will see in next 2 years more and more people will start sharing if a trusted community is created. JustShareIt creates a trusted community by people signing up as a member and going through a background and dmv check with many strict policies for sharing; then they facilitate the transaction between an owner and a borrower using their custom built device which tracks and secures the transaction. They are the first company in the world which tracks (borrower & car) and enables keyless entry (locking/unlocking doors etc.) via a webcam and cell phones/tablets/web due to their custom built device which they install in these assets/cars.

    There are also companies in the world like DriveMyCarRentals (Australia) etc. which are in car sharing but without any device attached to the car and their model seem to have worked. So I feel more we secure or track or eliminate the safety and security concern more people will be likely to share their highly priced underutilized assets such as cars.

  8. Pretty good stuff here. I’ve recently become enamored with collaborative consumption and have been researching it a bit. Jonathan, have you joined the collaborative consumption community more since writing this post? I’d be interested to hear whether you’re actively engaged in the scene.
    I have plans to put my 2 cents in cyberspace about this budding movement soon and this post helps put things in a good context for which I can expand upon.

  9. I am the founder of http://www.rentalic.com . First of all, thanks a lot for mentioning us on the article.

    At Rentalic, we have built superior technology solutions to protect both the parties involved in the P2P transaction (Owner/Borrower verification, payment made only after the 2 parties meet to exchange the goods, security deposit, rating system, etc.) We are not yet providing insurance, but the combination of trust and security solutions we have implemented so far kept our community in-line. In the past 15 months we’ve been in business, we have not yet seen any transactions going bad. People love the fact that they get to meet their community members as an added benefit. That way, P2P renting and sharing has become a great ice-breaker to meet others in your community and a great community building tool. Checkout: http://www.rentalic.com/about for more details.

  10. Pretty neat idea. It never even occurred to me..
    One of the many ways the internet is changing the world in ways we never thought it would. It brings people together and makes sharing and cooperating so much easier. Lets just hope most do so in a good way!

  11. I think peer-to-peer commerce is awesome. It’s not just about money, cars, or apartments. It should be about everything and anything. My friend recently launched a service that follows the same peer-to-peer lending concept: http://www.CameraLends.com, a peer-to-peer local camera gear website. They’ve launched in SF. I’m excited to see it keep growing!

Trackbacks

  1. Collaborative Consumption Part 1: How to Have Massively Less Clutter and More Money in Your Pocket | Enlightened Resource Management says:

    [...] can’t remember if I was first introduced to this concept by a post on My Money Blog or if it was in Wired magazine in a one page article. It was apparent to me right away that this [...]

Speak Your Mind

*