People across the UK are earning up to an additional £3,000 per year just by renting out their car parking space. In this post we’ll look in to the various ways you can rent out your driveway or parking space, where to start, how to price your space and how much you can earn.
Whilst looking around your house, in the loft, garage or shed, you may be hunting for that Del Boy moment. That lost ‘lesser’ watch, as it was known, that saw Del and Rodney pocket their long-awaited fortune to the tune £6.2m!
Upon your search you may be disappointed not to have found your own rare timepiece sitting in the garage, or a long lost Stradivarius gathering dust on top of an old stereo in the loft.
What many people fail to do though is look beyond their own four walls for an asset of something to sell. What is often right under their nose is rent-able space at the front of their property – namely a parking space.
With the continuous extortion local councils make on town and city trippers trying desperately to park their car for a couple of hours, and the eye watering prices on offer at NCP Car Parks, homeowners saw an opportunity.
That opportunity was to rent out their driveway, garage or parking space in front of their home.
People are already renting out rooms in their homes through AirBnb and renting out space in their car for a journey through Uber, why not their car parking space. Especially if you are not in need of it.
Fortunately, you don’t need to go through the trouble of creating an advert in your local paper, or create your driveway’s very own Facebook page, you can use one of the online marketplaces set up to allow people to rent out their parking space.
How does renting out a car parking space work?
Like most similar online marketplaces, it won’t cost you a penny to list your car parking space for rent. You just pay a commission to either Just Park or Your Parking Space for every booking, which is usually a percentage of the amount you earn.
Once you have opened an account you create a listing, upload some photos of your space and set a price.
Would be renters, when looking for a parking space, would visit Just park, Your Parking Space or both and search for the location they wish to rent a car parking space in and the dates and times they need the space for.
All available spaces are shown to the searcher on a map, showing where the car parking space is and how much it would cost to rent for the desired duration.
Once the searcher has found the space they would like to rent, they make a payment online to secure the booking.
The payment is taken by the provider, and you are paid once the booking is complete – minus of course the providers commission.
This way you don’t need to collect money or interact with the renter. In many cases you will not even need to speak to them, but a courteous hello and offer or local information can be a nice gesture and touch and can go a long way towards a positive review of your space.
How much does it cost to rent a driveway?
The marketplaces earn through charges to the drivers, rather than the providers. As the car park space provider, you are often charged very little in fees.
For example, Just park will charge you just 3% of your booking value. If you charge £20.00 to rent out your parking space for the day, you will pay just 60p in fees – and receive £19.40.
Just Eat will charge an admin fee to the driver making the booking, which is how they make their money.
Your Parking Space offers a similar payment structure, but they will not charge you any fees. They also uplift your price by around 20%. So, for example if you list your car parking space for £10 per day the Your Parking Space will charge the driver £12.00. They will keep £2 and you will be paid the full £10 – no additional fees.
How to value a car parking space?
There are a couple of methods to do this. First you need to look at your area. How popular is it, how expensive are local car parks and whether they are often full or often empty?
Is the demand outweighing the supply or are there enough cheap car parking spaces available?
If it’s the latter, you may struggle to find a demand for your space unless it’s in a particularly good hotspot. On the other hand, if there is a lot of demand for car parking spaces and not nearly enough supply, you could make a very decent second income.
You also need to keep an eye on the competition. Are their other car parking spaces on the same marketplaces nearby. If so, what are they charging, and again is their space very popular and often booked out – or isn’t rented out very often and always available?
There isn’t ‘one size fits all’. You need to be competitive. Put yourself in the shoes of a driver in the area. Based on the price and availability of car parks in the area, and the availability and cost from your own competition on sites such as Just Park and Your Parking Space, what would you pay?
Let’s say to park in your town costs £12.00 per day, and car parks are often over-run with many visitors circling the car parks looking for spaces. Your competition has a space listed for £11 per day – and they are a similar distance from the town as your property and space.
It may be prudent to list your space for between £9-£10 and under cut the competition. If your space is brand new and has little to no reviews or star rating, you may want to set this at between £7-£8 per day to start with.
Attract visitors and build a good review. It’s amazing how much of a difference and influence this is to drivers looking to rent a space.
A car is an expensive item so of course drivers will be happy to pay a little more for a space with lots of positive star ratings and glowing feedback showing how simple your space was to find, and how safe the area is etc…
How can I make my car park space stand out on Just Park or Your Parking Space?
Your car parking space – aside from being in the exact location to where a driver wants to park – can stand out for three main reasons:
- The price;
- Your star rating;
- Glowing feedback and reviews;
The price you can influence but the star rating and feedback is more difficult. Drivers want simplicity and to park their space without fuss.
They want very easy instructions on how to find your space and what to do when they get there.
If your property is difficult to find, then explain how. Make it very clear. If there is a specific space you wish the driver to park, make this clear too.
One of the biggest reasons for negative feedback on both Just Park and Your Parking Space are unclear instructions.
If you come in contact with the driver be polite and courteous. You are providing a service after all, and a service you are hoping for good feedback from.
It’s also worth taking good clear photos of your parking space. Grainy or blurry photos look unprofessional.
It may just sound like a lot of trivial detail, but this is how good reviews are earned – and having a great star rating and good reviews is how you can help your car parking space listing really stand out.
Do I need to pay tax on the rent from my car parking space?
It appears that up to £1,000 earning per year, you would not need to pay tax. This is according to Bennett Verby accountants and MCL accountants, you are not required to pay tax or declare the extra income from renting out your car parking space, as long as it doesn’t exceed the value of £1,000.
This is due to new allowances brought out in 2017 which allows homeowners to earn up to £1,000 income, in addition to your personal allowances, as part as a property income allowance.
Of course, Government allowances and policies change often, so please consult an accountant, financial expert and, or, your local tax office for further information.
How much can I earn through renting my car parking space?
This amount will often depend on demand for spaces in your area, along with the number of competitors you have.
Let’s say you live in an area which has a high demand for car parking spaces and feel you could charge £15 a day for your space but notice three other properties within a half a mile radius also listing their space, and all three are charging just £12 per day.
Unless your car parking space has a lot of benefits (such as next door to a popular venue) it wouldn’t be prudent to charge £15 otherwise drivers will look at your competition first, and only if fully booked would look at renting your space.
You really have to look at this from the eyes of the driver. Be as impartial as you can and looking at the competition on the high street, and in local car parks, and also include competition from nearby renters – you should be able to calculate an approx. amount.
If you prefer to undercut the competition and stand out for drivers looking for the lowest price, you should look to undercut your competition by around 10%.
So, if your competition advertises their space for £15 a day, you could try setting your price at £13.50 a day.
Just because you list your car parking space for rent at one price, doesn’t mean it’s set in stone. You can change as you go. Try adjusting the price to see how it impacts demand and settle for the price which brings in the most amount of income.
Renting your car parking space is one of the easiest ways to earn a passive income. You simply list your space and you’re done.
Your interaction with your customers is minimal to none. Be around when you can to help and provide any local knowledge drivers from out of town might need, but you can rent your space even whilst your on holiday, or at work etc… as long as your instructions are clear and you leave a contact telephone number in case a driver needs to reach you in an emergency.
Take a look at car park rental opportunities in your area, and see how much passive income you can start earning.