Neighbor Storage Review: Legit Airbnb for Storage or Logistical Nightmare?Other Passive Income Ideas
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Do you have extra room in your garage or basement and want to earn some cash? Or maybe you have the opposite problem – more stuff than space. If either of these applies to you, you might want to read more about Neighbor Storage.
Neighbor bills itself as the “Airbnb for storage,” but does it live up to that name? Let’s take a look at everything you need to know before using neighbor.com as either a renter or a host.
How Does Neighbor.com Work?
It’s easy to see the similarities between Neighbor and Airbnb. However, whereas Airbnb connects travelers with hosts with spare bedrooms, neighbor.com is all about self-storage.
While Neighbor Storage offers a range of unique features, it’s important to understand exactly how it works. It’s a great place to get started when it comes to self-storage, but the service does come with certain limitations that both renters and hosts should be aware of.
The Neighbor Storage Renter’s Experience
Renting with a third-party host like Neighbor is often both cheaper and more convenient. You’ll also be able to look for a wider range of options than are available at most storage facilities.
If you’ve ever used Airbnb to rent a home or apartment, you’ll be familiar with many of neighbor.com’s features. Let’s take a closer look at them.
Searching Neighbor’s Listings
Renters can look for private storage units to rent everywhere from basements to garages, to even bedroom closets. But neighbor.com’s not limited to residential spaces — you’ll find warehouses listed there too.
Got a boat or an RV? Neighbor’s got you covered here as well. There are indoor storage units for all kinds of vehicles listed on the site.
Users can search with filters for size and price to find a storage area that meets their needs. Unlike many storage units with annual or monthly contracts, a large number of Neighbor hosts offer their spaces for relatively short periods of time. That’s great if you want to stash something away for just a few days.
Neighbor’s flexibility, convenience, and transparency have made it an increasingly popular self-storage option.
Neighbor Storage Fees
Renters are responsible for a variable service fee in addition to the cost of the storage space. You’ll see the service fee when you make a new reservation on the website or app.
Neighbor makes payment simple and protects both renters and hosts from fraud and other risks.
Renters are required to enter payment information when they apply for a storage reservation. From there, the card is charged automatically as soon as the host approves the booking.
Month-to-month rentals are charged on the same day of each month. For example, if you start your rental on July 12, you’ll auto-pay on August 12, September 12, etc.
What If You Need to Cancel?
Cancellations are sometimes inevitable, and neighbor.com protects both parties with its cancellation policies.
If you need to cancel, you’ll receive a full refund as long as you do it within 24 hours of making the booking and/or at least three days before the reservation begins. You’ll receive only an 80% refund if you cancel after this grace period.
If a host cancels your reservation before your scheduled time, you’ll receive a full refund. Neighbor’s team will also work with you to find a suitable replacement space.
Renting from a stranger rather than a dedicated storage unit company might sound risky. To earn renters’ confidence and protect each side, Neighbor offers coverage for both renters and hosts.
As a renter, your items will be protected for up to $25,000 in case of damage or theft. While the website requires you to disclose the value of your items, the coverage is completely free.
Accessing Your Stuff
Access to your items is determined by the host. Some spaces provide 24/7 access or availability during business hours.
However, if you’re renting a space in someone’s house, you may need to set up an appointment. That’s easy enough to do through the Neighbor app.
The Neighbor Storage Host’s Experience
Neighbor Storage is a leader in peer-to-peer storage, and renting out storage space can be extremely lucrative. You could earn even more money per month if you have a larger space or live in a major city.
If you have any extra rooms in your home, renting them out for storage could be a great way to earn passive income.
Since Neighbor allows for so much flexibility, you can make money with even a small room or in a short period of time. The website also offers a rent estimator to help you determine the optimal price for your private storage unit, although you can charge more or less than the recommendation if you’d prefer.
Listing on neighbor.com is simple — just enter your location, describe the space, add pictures, and set a price. The platform also provides a range of additional features to make things easier for hosts.
Neighbor Storage vs. Airbnb
If you have extra space in your house, why rent it out for storage? Can’t you make more money by listing it on Airbnb?
Airbnb is an increasingly popular way of earning passive income, so renting out private storage units is a less obvious choice. That said, this approach offers a number of benefits compared to going the Airbnb route.
For starters, when you rent for storage rather than for travelers, you won’t spend as much time or money maintaining the space. Managing a home for short-term rentals can be extremely time-consuming, not to mention a drain on your resources.
You may also have areas in your house that are large enough for storing stuff but not for hosting a house guest. With Neighbor Storage, you can lease out something as small as your linen closet.
Many folks also feel uncomfortable having a stranger spend the night in their house. When you rent out a private storage unit, you can determine when the renter can access their stuff. You have more control over your space.
On the other hand, you could earn substantially more by allowing people to stay in the space. Short-term rentals are incredibly lucrative, and renters aren’t willing to spend as much on storage.
That said, becoming an Airbnb host is much more complicated than listing your space on Neighbor. Maintaining a room for tenants takes much more time and resources than simply using it for storage.
Whether that extra time is worth the additional money depends on your schedule and financial situation.
How Do Hosts Get Paid?
Neighbor facilitates the entire payment process and automatically deposits funds into the host’s account. This is where Neighbor Storage’s hosting fees come into play.
Although it’s free to list a space on the website, Neighbor takes a chunk out of each deposit to pay for the cost of automated payments. The current rate is 4.9% plus 30 cents per payout.
Now, this could be enough to make an impact on your earnings. Make sure to take the payment fee into account when adding storage revenue to your budget.
Can You Cancel a Reservation?
Hosts can cancel a reservation at any time before the start of the rental period. In this case, renters will be issued a full refund.
However, if you want to cancel after the storage space is occupied, it gets a bit more complicated.
If you’re a Neighbor host and want to “evict” your tenant for any reason, you’re required to provide at least 30 days’ notice. If you don’t, you’ll be subject to a $60 termination fee.
Hosts who repeatedly cancel reservations may be suspended or permanently removed from the site.
Taking in someone else’s things could lead to liability issues, but Neighbor offers some protection for its hosts. While you’ll be liable for anything you damage or lose yourself, the platform will provide coverage in case of something out of your control – say, a flood or a fire.
In addition to coverage for the items in storage, Neighbor also protects hosts from personal liability for up to $2 million. If your location gets damaged, Neighbor’s insurance will also protect you for up to $10,000.
Neighbor hosts have the option to restrict certain items from their spaces, so you aren’t required to store anything you aren’t comfortable with. The website itself restricts a variety of potentially dangerous items including weapons and ammunition, stolen goods, drugs, perishable foods, waste, pesticides, flammable or hazardous materials, and more.
And if you’re concerned about renting out storage space in your home to a stranger, Neighbor also gives you the option to accept only renters with mutual friends on Facebook.
If your home isn’t outfitted for storage, neighbor.com partners with Vivint to provide low-cost retrofitting. You’ll have access to cutting-edge home security technology at a fraction of the usual cost. With Neighbor, you can be confident that you aren’t taking on any unnecessary risks.
As mentioned above, the ability to decide when renters have access to your space is another critical benefit.
Neighbor.com allows you to choose among three options: 24/7, business hours, or appointment only. Which one is right for you likely depends on the type of space and your level of comfort with the renter.
We suspect the appointment-only option is the most popular choice among Neighbor hosts. By requiring renters to set an appointment, you avoid having any unexpected guests at the wrong times.
Remember, although hosts get to dictate how and when a space can be accessed, you’ll still need to make it available at some point in time.
If you’re planning to do some extended traveling, you’ll have to make alternative arrangements for a renter if they want to access the space. Keep this in mind before listing a private storage unit.
Neighbor Storage Pros and Cons
Renting a private storage unit or listing your own extra space on neighbor.com seems like a great way to make money. However, as with most opportunities, there are limitations you should be aware of.
Let’s weigh the pros and cons.
Neighbor Storage Pros
Flexibility is a top selling point for both renters and hosts, since Neighbor allows for nearly any storage arrangement. For example, rather than being locked into a long-term contract, you can negotiate rental terms for as little or as long as you want.
Similarly, it can be hard to find spaces much smaller or larger than the average storage unit. Neighbor offers listings of all sizes so you can find a space for just a few boxes or even a car, boat, or RV in certain areas.
Truly Passive Income
Renting out a private storage space using neighbor.com can be the very definition of “easy money.”
You don’t need to clean up after any untidy house guests, as with Airbnb. All you have to do is allow someone to put their stuff on your property and watch the monthly checks roll in.
Cheaper Than Traditional Storage
Most traditional storage units charge higher rates than what you’ll find on Neighbor. While specific prices vary from one host to another, Neighbor advertises up to 50% savings for renters.
And if you’re able to find the right host, you could spend substantially less for an even better private storage unit.
Neighbor Storage Cons
Neighbor protects both sides from liability, but there are some risks involved in peer-to-peer storage rentals.
To be honest, it takes a good deal of trust to leave your belongings in someone else’s house. Even if Neighbor’s insurance policies take care of replacement costs, losing an item of monetary or nostalgic significance can be agony.
For hosts, there are other liability risks. You’ll have to compensate renters for any theft or loss unless you file a police report and they find evidence of forcible entry.
You’ll also be responsible for medical costs if a renter is injured due to your gross misconduct.
Not Widely Available
Neighbor.com is still more widely available in some areas than others. If you live in a region where it’s not as popular, it may be difficult to find an affordable space.
Check out the local listings to get a better idea of what’s available in your area.
While hosts can earn a significant amount of money on Neighbor, prices are generally lower than conventional storage spaces. You’ll need to price your space competitively in order to attract renters. This puts a cap on how much you can make with Neighbor, especially if you don’t live in a high-rent area.
Neighbor.com is an interesting concept in the peer-to-peer app space. For all intents and purposes, it’s the Airbnb for storage.
And like Airbnb, Neighbor Storage offers strong features and protections and makes the process easy for both sides of each reservation.
It’s a great choice if you’re looking for private storage for rent with flexible terms. But it’s also a good way to start earning passive income.
Logan is a practicing CPA and founder of Choice Tax Relief and Money Done Right. After spending nearly a decade in the corporate world helping big businesses save money, he launched his blog with the goal of helping everyday Americans earn, save, and invest more money. Learn more about Logan.