How to Rent Out Your Car

Renting out your car is a hot source of passive income. Find out where you can rent out your car and how much you could earn.

Owning a vehicle ain't cheap. According to the AAA, it costs almost $9,000 per year to own a car.

If you don't drive often, you can make money by renting out your car on peer-to-peer car rental platforms. Listing your car and getting paid is pretty quick and simple - especially during popular vacation seasons.

Here's what you need to know to get started. Plus, find more tips on how to make money off your car.

How Do Peer-to-Peer Car Rentals Work?

Peer-to-peer car rental is a source of passive income. All you need to do is create a listing for your car online and wait for people to rent it out.

These peer-to-peer rental apps connect people in your area in need of a vehicle. They reach out to you through the app instead of a rental company.

Everything is done on the apps: from listing the car, messaging, safe and reliable payment processing, and more. But these apps have different rental fees and stipulations for using their platforms (more on that in sec).

Which App can You Use to Rent Out Your Car?

You have a ton of options for renting out your car. The rise of on-demand transportation services has spurred the growth of online car rentals. Find out how to make bank off your car below.

1. Turo - Best Overall

Known as the Airbnb for cars, Turo is one of the most popular peer-to-peer car rental apps. They claim to be the world's largest car-sharing marketplace with over 14 million prescreened customers.

It's free to list on Turo. You choose your own rental rates, pickup location, and rules like mileage restrictions. And if you own multiple cars, you can start a car-sharing business.

Turo is available in many U.S. cities and even some Canadian provinces. You can decide when your car is available to rent and block out dates when you don't want to rent. And Turo does not rent to rideshare drivers so there'll be less wear and tear on your car.

You'll get notified when someone requests to book your car. Just accept or decline their request and coordinate a meetup with the renter.

Earnings, Fees, Downsides

• Earning potential: $876 per month
  
• Cost: Free to list
  
• Compensation: 65% - 85% of the rental cost
  
• Insurance: Up to $750,00 in liability insurance included
  
• Cons: Unable to rent hourly; may need to meet the renter to hand off keys unless a key box is used because Turo Go (feature that allows renters to locate and unlock your car with the app) is optional

2. Getaround - Best for Renting Hourly

Getaround stands out from other peer-to-peer car-sharing apps because the app lets users rent by the hour. However, the app is not available nationwide.

If you live in a city that Getaround operates in, you must install the Getaround Connect hardware. This lets guests locate and unlock your car so you don't need to meet them in person or use a key box to hand off keys.

As with Turo, you can set your own prices and all potential renters are prescreened by Getaround. Most prescreened folks can rent your car including drivers who use Uber (but not Lyft).

Earnings, Fees, Downsides

• Earning potential: As much as $10,000 a year
  
• Cost: First 90 days free, then a $20 monthly subscription fee; one-time $99 payment required for Getaround Connect hardware installation
  
• Compensation: 60%
  
• Insurance: Included
  
• Cons: Not available nationwide

3. HyreCar - for Rideshare and Delivery Drivers

HyreCar partners with Uber and Lyft so drivers can rent your car to drive for ridesharing apps and delivery service apps (like DoorDash and Postmates). In addition, these drivers are carefully vetted before joining HyreCar.

This can get you long-term rental requests with minimal work involved. Your car can be used to drive passengers around town or deliver food and packages.

Before your rental listing is live, your vehicle must be inspected and approved by Uber and Lyft. HyreCar does not offer hardware for locating and unlocking the vehicle with the app, so you'll need to meet the renters to hand off keys.

Earnings, Fees, Downsides

• Earning potential: Up to $1,200 per month
  
• Cost: Free to create a listing
  
• Compensation: 85% of rental cost
  
• Insurance: $300,000 liability and damage protection plans
  
• Cons: No hardware installation to locate and unlock vehicle with the app

4. TravelCar - Best for Travelers

Parking your car at airports can cost as much as $17 per day. What if you could leave your car at the airport while traveling and make money on it?

TravelCar connects you to renters while you're out of town. Meanwhile, you get free parking and a free car wash. Plus, you can earn money for every mile driven up to $100. Insurance is included.

And if you list your car but it doesn't get rented out, you still get free parking for up to 7 days. TravelCar is in 62 countries and works with 500,000 parking spaces and 1,000,000 frequent users.

Earnings, Fees, Downsides

• Earning potential: Up to $100 per rental
  
• Cost: Free to list
  
• Compensation: Up to $100 per rental
  
• Insurance: $1 million in liability insurance and coverage against theft and physical damage while renting out your car
  
• Cons: Doesn't specify if TravelCar prescreens drivers on website

5. Avail - Best Referral Bonuses

Avail is similar to TravelCar - they'll rent your car out when you're traveling. What makes Avail special is that you get $50 for each friend who takes a friend with Avail. And your friends will also receive $50 toward their trip immediately.

Just park your car in the Avail car share parking lot and you're good to go. On their website, Avail boasts that they've saved owners over $660,100 in parking costs.

Renters will even refuel your car before it's dropped off. For an average 4-day trip, you could make $140 in earnings, $25 referral, $100 first-time user bonus, and save on $100 worth of parking costs.

Earnings, Fees, Downsides

• Earning potential: Up to $35 per day
  
• Cost: Free to list
  
• Compensation: Up to $35 per day
  
• Insurance: Up to $1 million in Allstate insurance and covered for roadside assistance
  
• Cons: Car must be under 10 years old and have less than 125,000 miles on it to rent on Avail

How Much Can You Make Renting Your Car?

HyreCar estimates that the average car owner makes $14,000 per year; Turo says the average annual income for 1 car is $10,516.

Your potential earnings depend on your vehicle's type, age, make, and model. Also, the service you use to rent out your vehicle may have fees that affect your earnings.

Use Turo's online calculator to help you estimate how much your car could earn you.

Turo's rental fees are between 65% and 85% of the trip price. So you'll get $32.50 - $42.50 if you list your car for $50 per day. If you make a habit of renting cars, you'll generate passive income all year long.

What are the Risks of Renting Out Your Car?

It can be nerve-wracking to rent out your car. Rental companies try to offset these concerns by offering large insurance policies. Renters cover the price of the policy - usually more than $500,000.

If your car does get damaged, the renter pays a deductible and the rental company is responsible for fixing your car.

Some apps like Avail force renters to refuel gas before returning a vehicle. And rental companies charge a fee to have your car cleaned and detailed.

Other Ways to Make Money with Your Car

Prefer to be behind the wheels of your own cars instead of renting it out? You still have a lot of ways to make money. This section isn't all passive income - you need to be actively working for some of these ideas.

1. Turn your car into a moving advertising board with Wrapify - Earn $200 - 400 per month

2. Pick up scooters with Lime Juicer - Earn $8 per scooter

3. Deliver food with DoorDash - Earnings vary

4. Deliver packages and groceries - Earnings vary

5. Drive people around town with Uber, Lyft, and other apps - Earn up to $30 an hour

Bottom Line

This side hustle is a whole lot easier than driving people or delivering goods in ridesharing apps. And there are several car rental companies to make money off your vehicle.

If you're not comfortable with renting out your car to a stranger, consider getting paid to drive your car. It's not passive income, but you can still make money on the side.