5/11/2012 4:00 PM ET|
How to rent out your life
Today you can rent out or swap nearly anything, including your car, your driveway and the family dog.
Rob Baedeker started by renting out his unused camping trailer with an ad on Airbnb. By the end of his experiment, he'd rented out his car, his guitar -- and the family dog.
Baedeker, a San Francisco Bay Area communications consultant, had been hearing about the "collaborative consumption" movement, which encourages people to swap, share or rent rather than buy or own. He was intrigued by sites such as Airbnb that connect travelers with people willing to sell overnight visits in their homes. An assignment for Newsweek to write about renting out his life gave him the excuse to try it.
"I also liked the idea of going all out and doing this as an experiment for a couple of weeks, seeing how it would affect my life and whether it was worth the trouble," Baedeker wrote me in an email. "It did change my day-to-day life, mostly in the way it required me to open up to new people and take a leap of faith in strangers."
There's nothing new about renting out an unused room, or bartering or sharing. What's changed is the addition of the Internet, which allows strangers to connect for these transactions on an unprecedented, massive scale, according to Rachel Botsman and Roo Rogers, the authors of "What's Mine Is Yours: The Rise of Collaborative Consumption."
That's led to new business models that can supply people with what they need, when they need it, without the hassles of ownership, said Lisa Gansky, who wrote "The Mesh: Why the Future of Business Is Sharing."
The recession seems to have spurred rather than hampered the trend, as more people looked to make money -- and to save it -- by turning to peers rather than corporations. As Baedeker put it in his essay: "Why endure the long waits, high prices, and surly staff at your big-box tool-rental counter when you can pick up Rob Baedeker's electric sander for a song -- and go home with a smile?"
Another attraction: the environmental factor. Rather than letting your stuff lie around unused, it can be rented out repeatedly to maximize its utility -- and your profit. The people renting it help save the planet by not buying similar items (and letting them sit around unused).
Craigslist is the big kahuna of peer-to-peer transactions (and the one Baedeker used to list his dog for $3 an hour). Rentalic, SnapGoods, Rentabilities and Zilok are among the sites that connect people who want to rent stuff with people who have stuff for rent.
Some other collaborative-consumption businesses include:
- RelayRides and Getaround, which are peer-to-peer car rental sites. Unlike Zipcar, a car-sharing service that maintains fleets of cars in various cities, the peer-to-peer sites allow individuals to list their vehicles for rent at whatever price and for whatever times they want. A spot check of RelayRides listings near my Los Angeles home showed nearly two dozen listings available for an upcoming Saturday, with prices ranging from $5 an hour for "Becky's" 2003 Hyundai to $40 an hour for "Angel's" 2009 Mercedes-Benz.
- If what you need isn't a car but a place to park it, or if you have an empty spot in your driveway to rent, you can check out ParkatmyHouse. If you need someplace to park yourself, Loosecubes connects people who need temporary office space with those who have space to offer.
- Airbnb, CouchSurfing and HomeExchange.com link travelers with people willing to accommodate them, although with different business models. Airbnb works like the car rental sites, with people listing the rooms/beds/spaces they have available for rent. CouchSurfing connects hosts with guests who typically stay for free. With HomeExchange, people swap their homes for short- or long-term stays.
- If you're looking for carpool partners or someone to share a road trip, check out Zimride.
- Prosper and LendingClub connect people who want to lend money with people who want to borrow it. On a more philanthropic note, Kickstarter helps creative types -- filmmakers, musicians, artists and designers -- find funding for their efforts, while donors get to directly support the arts. Meanwhile, schoolteachers post requests for their projects on DonorsChoose.org, and the charitably inclined get to pick which they want to fund.
- Designer clothing, handbags and jewelry are available for rent from sites such as Bag Borrow or Steal and Rent the Runway, but you can also buy and sell kids' clothes on thredUP or arrange a swap of clothes -- or plenty of other items -- on Swap.com.
Of course, transactions between strangers can be fraught with risk. Baedeker had good experiences with his Airbnb rentals, but the company hastily instituted a $50,000 insurance policy for hosts after a couple of users complained that guests trashed their places.
Insurance coverage is typically part of the package at peer-to-peer car sharing sites, too. But putting your car out to rent could cause your insurer to drop you (except in California, Oregon and Washington state, where lawmakers restricted the practice). Or you could lose your car to theft. One car-sharing service, which specialized in luxury cars, was shut down after thieves circumvented the company's security procedures and stole four high-end cars.
Even renting a power tool can create a liability if the renter has an accident and blames you for providing a faulty product, insurance experts say. That's one of the reasons why rentals have traditionally been offered by deep-pocketed companies; they can pay for the insurance coverage and lawyers to handle the lawsuits.
The companies that facilitate sharing, swapping and renting say they have procedures in place to reduce risk. Plus, people who have used these services often comment about the relationship aspect -- how face-to-face or even email interactions have enriched their lives and made them more comfortable with the idea of sharing.
So I certainly won't tell you not to do it. Too many people have great experiences with collaborative consumption, and it's too efficient an idea economically, to just say no.
Just be careful, and weigh the benefits with the risk.
Baedeker, for one, still has the trailer listed for rent on Airbnb. He doesn't regret renting out his car (which was returned "in perfect shape" after a week) or the "constant stream of visitors in our house -- all of them interesting, polite guests."
But he did tire of the effort involved coordinating all those rentals.
"It felt like a full-time job hustling to deliver my dog to someone or arranging schedules for another person to pick up my daughter's bike or my electric sander," he told me. "The extra money was nice, but that intense rent streak wasn't sustainable for me."
And there's one item he won't ever rent again.
"Our dog. It just -- I'm not sure I want to be a guy who's always renting out his dog, you know?"
Liz Weston is the Web's most-read personal-finance writer. She is the author of several books, most recently "The 10 Commandments of Money: Survive and Thrive in the New Economy" (find it on Bing). Weston's award-winning columns appear every Monday and Thursday, exclusively on MSN Money. Join the conversation and send in your financial questions on Liz Weston's Facebook fan page.
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