I make £3,000 a month renting out my gadgets – how you can too
A SAVVY man has revealed how he makes thousands of pounds a month renting out gadgets online.
Ed Guida, 25, first discovered he could make a bit of cash as a side-hustle while studying five years ago..
As a film student he had camera equipment he wasn’t always using and decided to list it on a website called Fat Llama.
“It was so simple, I was shocked at how easy it was to make money from it,” Ed told The Sun.
Fat Llama allows owners to list pretty much anything they like on the site from campervans to sewing machines.
Renters can then borrow the item for a set price for a set period. The web site takes a 25% cut of the rental price.
Through using the website to borrow items for his course, Ed met Luca Rossini, and they decided to pool their equipment.
They started by charging as little as £3 a day and making between £40 and £150 a month for items like cameras and basic lighting.
Ed said: “We didn’t have very much at all at the beginning and they weren’t particularly high end items either so we weren’t making a lot.”
After three years the pair were making a profit and now rake in upwards from £3,000 a month from renting out a range of items on the platform.
Ed said: “I remember when we made our first £100 on a lighting system that we kept and didn’t reinvest.
“I couldn’t believe it – people were literally paying to rent our stuff and then we got it back at the end of the day? It was amazing.”
And they’ve been so successful they’ve even turned it into a business they both work on full time, Yellow Cactus, using the cash they make to buy more items they can rent out.
One item they invested in early on was an £800 camera system. Renting it out for £45 a day, they made the money back within 17 days.
The items they rent out earn them anything from a couple of hundred to a couple of thousand pounds.
They now list over 300 bits of equipment on Fat Llama and completed 1,400 rentals last year. On average they have around 30 borrowers a week.
Their most expensive rental costs include bundles of camera and lighting kit for up to £2,000 a day, while single items can get them up to £850 a day.
For borrowers, renting out equipment costs far less than buying it, saving them money.
A popular item for example is Astera Tubes which would set a buyer back between £4,800 and £6,400 for a set of eight.
But Ed rents them out for £100-£140 a day on Fat Llama. He needs to rent them out around 35 times before he covers the cost, and then makes money for every day it’s borrowed after that.
Ed said: “A general rule of thumb is it takes an item being rented out 20 times to cover the original cost.
“But, the rarer the item, the higher the price and the faster you start making money.”
How to make money renting out your unused items
You don’t have to have expensive camera equipment to make money on Fat Llama.
The site allows you to rent out pretty much anything including power tools and your old bike.
We found a mountain bike listed for £120 a day and a keyboard for £35 a day.
Even renting out an old tambourine could bring you £4 a day – over a week that’s £28.
All you need to do is take photos of the item you want to lend out and set a price.
But remember that how much you can make depends on the demand for the item, plus you’ll pay a fee to the platform.
Ed said: “It’s really important to have a look at the prices of your competitors to make sure you’re offering a decent rate.
“But do bear in mind that if someone else’s price is lower then it could be because their kit isn’t in as good condition or reviews reveal they’re not a reliable lender.”
He also said it’s good to know your worth, if you’re in a prime location for the thing you’re renting out, such as a bike right near a cycle trail, then you’ll likely have more keen renters.
“Reviews and reputation are key” according to Ed.
Lenders will want to build good relationships with potential renters by making sure they’re reliable, then when they leave you good reviews you’ll get even more interested parties.
You can also set weekly and monthly prices, as well as set periods renters can have the item for.
In Ed’s experience most rentals tend to be for a day but this will differ from item to item.
There are other sites which you can use to rent out your belongings and make money.
Pa-rent allows you to list household appliances too, we spoke to a mum who made £300 from renting out her barely-used carpet cleaner.
We spoke to a woman who managed to make £9,000 by renting out her clothes on By Rotation.
People also make extra cash by renting out their parking spaces for £600 a year and driveways too on sites like Your Parking Space.
Plus we spoke to a dad who made £1,600 by renting out his car on Karshare.
Renting risks – what you need to know
Ed said it’s important to weigh up the potential risk when renting out your kit.
People can damage your equipment whilst they’re renting it out and while there is insurance and renters will pay for any repairs, it can take time for this to take effect.
Anyone lending on Fat Llama has a guarantee that covers items up to £25,000, so if there is ever an issue with one of your belongings when you get it back, you’re covered insurance-wise to this amount.
But you should check with any platform you use who you’re covered for any damages and any terms and conditions in the small print.
That means that if you’ve only got one item, like an electric scooter or a sewing machine, then you could be out of pocket while you wait for it to be fixed.
Another thing to bear in mind is lenders are charged a 25% fee by Fat Llama, which acts as a service charge. That means the amount you make will have this deducted.
Of course how much you’ll earn will depend on how much you charge and how regularly people rent from you.
It’s best to try it out before you depend on the cash – just in case it doesn’t end up bringing in much.
It’s also important to note that in order to make a profit from Fat Llama you’ll need to make back the money you spent on the item in the first place, if it’s something you didn’t already have.
You’ll need to work out your break-even point, which is based on the price you paid, how much you rent it for, and the number of times it needs to be borrowed to cover the cost.
For example if you bought a £100 vacuum cleaner and decided to rent it out for £10 a day, you’d need to rent it at least ten times before you start making money.
It’s worth remembering that anything you earn with an extra income like this can be taxed.
You can earn up to £1,000 without paying tax thanks to the trading allowance.
The odd jobs you can claim tax-free include money made at car boot sales, online selling or auction, according to HMRC.
It could also include money made from food delivery or by charging other people for using your equipment or tools.
Once you earn more than £1,000 a year, you need to complete a self-assessment tax return and start paying tax on your extra earnings.
How much that is will depend on how much you already earn.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk