If you’re looking for a simple way to earn passive income that doesn’t require startup capital, you may want to look into Neighbor.com.
The platform, which bills itself as the “Airbnb of storage,” provides an easy way for you to rent unused space in and around your home to locals needing storage space. For your trouble, you’ll receive a monthly rent payment based on the price you set for your storage area.
Let’s dig a little deeper to see how Neighbor works, how much income you can make, and whether it’s right for you.
What is Neighbor.com?
Neighbor.com is the brainchild of three friends — co-founders Preston Alder, Colton Gardner, and Joseph Woodbury — who launched the company in Lehi, Utah, in 2017. As with many successful startups, Neighbor was born from a challenging incident.
Adler’s experience trying to store his items during a summer internship was difficult, and he ended up driving hours to store items in a friend’s garage. This helped spur the idea for this self-storage industry disruptor. The idea led to creating an app, which acts as a self-storage marketplace, allowing people with extra storage space to connect with individuals in their area looking for a place for their stuff.
Today, Neighbor.com has a footing in all 50 states plus Washington, D.C., and it’s added boat, car, and RV storage in many cities. It also recently closed on a $10 million Series A funding round led by Andreessen Horowitz and a $53 million Series B funding round led by Fifth Wall.
Neighbor gets its name from its primary objective: connecting people within a community to help each other with their storage needs. It’s generally more convenient and time-efficient to store your things at a neighbor’s house than to drive across town to a storage unit.
How does Neighbor work?
Neighbor connects storage renters with hosts in their neighborhood who lease unused storage space in their home, garage, or property. For Neighbor renters, the platform could be a cheaper and more convenient alternative to traditional storage facilities. For Neighbor hosts, the platform represents a great new way to earn passive income.
How people use Neighbor.com varies widely. For example, a college student might be able to store a few boxes and a bicycle in the corner of a neighbor’s shed for $50 per month. By contrast, a small 5-by-5 storage unit with a national storage facility could cost $55 per month or higher, depending on your location.
On the other hand, a car enthusiast could store a classic car in their neighbor’s garage for $200 a month. They might only have to travel a few doors or a few blocks to get access to their car when they want to work on it or take it for a spin.
When you sign up as a host on Neighbor, you link your bank account so you can receive payments. That’s all you have to do in terms of payments, as Neighbor collects the rent for you and deposits money in your account each month. If you’re wondering how to make money without much effort, Neighbor could be the answer. It’s important to be aware, though, that Neighbor charges hosts a 4.9% processing fee and 30 cents for every reservation.
When you receive a reservation request, the renter has already paid for the space. After that, Neighbor automatically bills the renter on their renewal date, so you’ll receive rent money each month, minus fees. And with Neighbor’s Payout Protection, your payments are guaranteed, even if the renter fails to pay.
In this listing, the host is listing their unused parking space for $85 per month. If this host approves a renter for the space, they’ll receive the $85 minus $4.16 for Neighbor’s 4.9% processing fee and another 30 cents for the transaction fee. That brings their monthly payment to $80.54 ($85.00 - $4.16 - $0.30).
If the renter keeps the space for one year, the host will make $966.48 ($80.54 x 12). That’s a nice chunk of change with minimal work required. The main “work” the host performs is making sure the renter has unrestricted access to the space during the hours stated in their rental agreement.
Who is Neighbor best for?
Although many people can use Neighbor, the service is best for anyone looking to make extra money by leasing their unused space to people who live near them. During Neighbor’s initial months as a startup, hosts could only rent out space in and around their home, including their basement, bedroom, garage, and shed. The service has since expanded to offer office, RV, and warehouse space.
Although Neighbor is primarily a person-to-person platform, its app has seen a large influx of businesses affected by the pandemic. For example, some restaurants are repurposing their space into rentable storage areas. Other companies turned parking lots into boat and RV storage.
As you can see, Neighbor is one of the most unique ways to make money. All you need is some extra space and an excellent plan to monetize it.
How much can you earn with Neighbor?
The amount of money you can make renting out extra space with Neighbor.com depends on several factors, such as the cost and availability of storage in your area.
However, if it’s hard numbers you’re after, here are some figures we pulled from the Neighbor website for various types of rental spaces:
- Garage: Earn between $100-$600 per month.
- Driveway: Earn between $50-$150 per month.
- Shed: Earn $50-$200 per month.
- Parking space: Earn $50-$300 per month.
Browse your local listings to discover the going rates for storage space in your area.
Maximizing your earnings with Neighbor.com
Although publishing your listing on Neighbor could help you find renters on its own, you might be able to rent your space faster and maximize your earnings using promotional techniques, such as:
- Sharing your listing on your social channels
- Asking friends and family if they know anyone seeking storage space
- Hanging flyers of your listing on bulletin boards at local stores and colleges
You can also boost your rankings on Neighbor by optimizing your listing. Consider these best practices to help foster trust and engagement while potentially improving your rankings.
- Profile photo: A profile photo helps renters know there’s a real person behind the listing.
- Personal bio: People do business with people they know, like, and trust, so don’t be afraid to tell renters a bit about yourself.
- Lots of photos: Neighbor advises including three to six pictures of your clean space to improve your quality score.
- Description: Include a minimum of three sentences that provide the essential details about your available space.
Is Neighbor.com legit?
Yes, Neighbor is a legitimate company that could help people save money by storing their things with a neighbor, typically for less than you’d pay with a traditional self-storage company. The Neighbor app offers a renter guarantee, providing free property protection for renters up to $25,000 for theft or damage of qualified items, though it’s subject to certain conditions.
What safety and security features does Neighbor offer for hosts?
Neighbor's host liability guarantee also provides hosts up to $1 million in general liability protection at no additional cost. As you might expect, the protection comes with some limitations and conditions. For example, Neighbor’s liability protection is considered secondary to your homeowners insurance policy.
Neighbor also places restrictions on what items can be stored with a host. The following items are considered restricted:
- Hazardous materials
- Stolen property
How does Neighbor make money?
Neighbor makes money by charging fees to both hosts and renters. Neighbor charges hosts a 4.9% processing fee and 30 cents for every reservation. Neighbor also charges renters a service fee. According to the site’s terms and conditions, the fee is set and communicated to renters when they confirm storage space booking. However, we could not turn up any hard figures on Neighbor’s site stating how much the service fee is.
How do you get paid through Neighbor?
Neighbor automatically charges renters each month and deposits the rent, minus fees, into your bank account.
How to stay safe with Neighbor.com
Neighbor tries to keep a safe environment by requiring all hosts to verify their email and phone number. Hosts must also verify their identity by submitting a photo identification to a Neighbor. And because Neighbor processes all payments through payment gateway Stripe, the platform requires hosts to submit either a Social Security number (SSN) or a Tax ID number (TIN), too.
As a host, you can also place restrictions on prospective renters. For example, you can require renters to have a profile picture and a Facebook account or verified phone number linked to their Neighbor account. You can also prohibit specific items from being stored. Prospective renters must meet your requirements to be eligible to request a space booking.
Sometimes hosts need to reclaim their space and wish to end the storage agreement with the renter. In this case, a host must provide 30-day advance notice or be subject to a $60 eviction fee (unless the renter violates the terms of service).
How to get started with Neighbor.com
Using the service starts by visiting Neighbor’s website and opening an account or downloading the iOS or Android mobile app from the Apple App Store or the Google Play store.
You can start hosting on Neighbor by following these simple steps:
- List your unused space on Neighbor. You can list your garage, basement, spare bedroom, shed, driveway — anywhere you have extra space you wouldn’t mind sharing with a renter. You can set your own price for your available rental space.
- Approve renters. Prospective renters will respond to your listing. You can ask questions about what they will be storing or even arrange to meet them and view the storage items before you agree to rent space to them. All communications can be made through the app to protect your personal information.
- Earn money. Neighbor will collect fees from the renter and disburse payment to you each month. Neighbor charges a payment processing fee for using its service, 4.9% of your rental price and 30 cents for every reservation.
Other side hustles to consider
Neighbor provides a legitimate way to earn passive income with very little work involved. But, although Neighbor provides the perfect income opportunity for some people, it may not be suitable for you.
If earning money in your neighborhood is intriguing, you might consider walking dogs for extra cash with Rover (read our Rover review) or performing home improvement jobs through HomeAdvisor (read our HomeAdvisor review.)
Better yet, check out our ultimate guide to the best side hustles to find the perfect income opportunity for you.