Waste of space? Your unused room could be a self-storage goldmine

Britain’s self-storage industry is set to reach the billion-pound mark this year.

But finding space is becoming harder, particularly in crowded cities. Storage units in London are now 88pc full, up from 83.9pc in 2022. 

Those weighed down by excess possessions have been forced to get creative – and those lucky enough to have room to spare have been cashing in. 

Firms like Stashbee, Co Stockage (which operates in France) and Spacer (Sydney’s version) offer “peer-to-peer” storage, which allows anyone with a garage, loft or spare room to rent it out. 

The burgeoning industry has been called “AirBnB for clutter”, and it can be a lucrative source of passive income. However, housing someone else’s possessions is not without complications – making sure they’re secure, and navigating the person’s right to access them are just a couple of considerations.

Here, Telegraph Money explains how to convert your spare space into cash. 

How can you rent out spare space?

Peer-to-peer storage firms match people who have space to spare with people looking to store their belongings, much as AirBnB does for rental properties. 

If you have a space you’d like to rent, you simply upload a listing to a platform, choose how much you want to charge, and then pick and choose between any offers that come your way. 

Hosts and renters are reviewed using a star rating system, which helps build trust. 

You don’t have to be a homeowner to benefit; most platforms will also allow renters to become hosts – but you’ll need to check your tenancy agreement to see if it’s allowed. 

David Mantle, founder and chief executive of Stashbee, explained how the sign-up process works: “You need to provide information on the location of the space, a brief description of the space, the security features it has, lighting, etc. Then snap a few pictures on your phone, upload them, and that’s pretty much it. 

“Once this is posted on the site you can start to receive enquiries from people interested in the space.”

If you’re nervous about letting a stranger into your property, Mr Mantle explained how Stashbee carries out extra checks on people who want to store their belongings.

“To increase the level of security we do ID checking as well. We verify that the people using our service are the people they say they are,” he said.

“You will usually need to jump through hoops to confirm your identity, which will involve uploading a picture of your passport.”

Of course, using these platforms is not the only option. You could also set up a less formal arrangement yourself, advertising your spare space on neighbourhood forums and social media – but you won’t have the same level of security offered by a company that sorts the pairing for you.

What kind of space is best-suited for storage? 

Any secure space such as a garage, outhouse, spare room, attic, or parking space can be rented out to people looking to store their stuff, which could be anything from old family heirlooms to caravans. 

Death, divorce, downsizing, decluttering – “the four Ds of storage” – are the main motivators for people who are seeking to rent space, according to Mr Mantle. 

He added: “The best spaces tend to be larger ones, like garages and spare rooms, which are fairly clear and open for people to move stuff in and out of. 

“Parking spaces for vehicles and storage containers are the most popular on the platform.”

If you don’t have that kind of free square footage, Mr Mantle said far smaller spaces can also be rented out: “In terms of quirky ones, you even have people renting out space in cupboards, which works for some renters.”

How does location affect things?

Unsurprisingly, storage space from firms in crowded cities commands a higher price. 

Mr Mantle said: “There’s a real premium on location. You’re going to be paying a lot more for a space in Mayfair than you would be further out.”

However, prices don’t tend to fluctuate as much when it comes to peer-to-peer storage.

“London and the South East tend to have higher prices, but the regional variation isn’t massive,” he added.

Because peer-to-peer storage means people are renting out under-used space, rather than scarce room in a storage firm’s container, renters often get a bargain. 

Peer-to-peer storage can be up to 50pc cheaper than traditional storage, according to US storage provider, Neighbor. 

“The big benefit is hyper-locality,” said Mr Mantle. “Storage units tend to be on the outskirts of cities, not really where people live – but with peer-to-peer storage you can literally be storing stuff across the road.”

How much money can you make?

As with anything, the amount you can rent your space out for really depends on how much prospective renters are willing to pay. If you live in or near a city, or have a particularly large space to rent, or have invested in specific security measures then you might be able to charge a bit more. If you’re only offering a little space in a cupboard, you’ll probably find you can’t charge very much.

If you’re not sure how much to charge, the easiest way to gauge it is by taking a look for anyone with a similar space to you and opting for something similar. If you don’t have any offers for a while after your listing goes up, it may be an indication that you’ve priced the space too high.

The top 10pc of hosts on Stashbee earned £267.62 in October 2023, while the top 5pc earned £347.68. Some have made tens of thousands of pounds, according to Mr Mantle. 

He said: “Our highest earning individual – a homeowner – has made £28,800 so far from renting out his space around his home, including a spare room, basement and an outhouse.”

Not everyone will be in a position to put so much space up for rent, and Mr Mantle said it’s more common for people to use the platform to make a little extra money.

“Inflation, the economy, cost of living – it’s just a great way of making people a bit of cash, in a super passive way.”

It’s worth noting that rental platforms will usually take a cut of your booking value – Stashbee, for example, charges 20pc – so you might want to factor this into the prices you charge. 

Tessa Cox, from Godalming, Surrey, has been renting out the garage of a flat she owns for five years. In that time she has made more than £5,000.

She said: “We got a lot of interest quickly after the listing went live.

“I’ve had a few tenants over the years. Some have stored cars, others have stored furniture and personal items. 

“They haven’t had enough room in their own house. One tenant was downsizing and needed extra storage space.

Ms Cox, who lives with her husband and one-year-old son, started renting the space after a friend just suggested it as a way to make some more money.

She added: “I make about £90 a month. Especially now, with a small child, it’s always useful to have a bit of extra money – before that, it was going towards the mortgage. 

“It’s been helpful. It just goes straight into my bank account.”

How does it work when people want to access their stuff? 

One possible inconvenience is that the renter may want to retrieve their possessions, and will need to access your property, garage or container. 

As an affable host, you’ll need to allow some access to their items, but Mr Mantle says it’s possible to set out terms around the level of access from the outset. 

He said: “When you list your space with Stashbee, one of the core questions you’re asked is what sort of access you want to provide – anything from ‘anytime access’ when you give someone a key and they can come and go as they please, or ‘only between specific hours’, or ‘pre-arranged times’. 

“It’s super flexible depending on the owner of the space. You can sift out what kind of access you want.”

In general, Mr Mantle said those renting out a space will see little of the people using it.

“The interactions involved in the process are quite minimal,” he said. “You have one person turning up for 15 to 40 minutes to drop off their stuff and then leave it there for a very long time.

“Storage is a very ‘sticky’ product. If someone goes travelling, for instance, people might pack up their stuff and put it in a garage for 12 or 18 months while they’re away. People can be around for a long time.

“Most customers storing stuff don’t require high levels of access. The business customers storing stock do a bit more, but mostly they don’t.”

Ms Cox added: “My tenants stay on average a year, so it’s not inconvenient. It’s really straightforward.”

Do you need extra insurance to cover someone else’s possessions?

Hosting someone’s belongings on your property can prove a little tricky from an insurance perspective, particularly in cases of theft, fire or damage.

Stashbee requires anyone hiring storage space to take out at least a minimum level of insurance to cover these eventualities.

The compulsory level of insurance costs £5.99, and gives you £1,000 of cover. For £14.99 you get £3,000 of cover.

Mr Mantle advised letting your mortgage provider and home insurance provider know if you are renting out space in your house for other people’s possessions. 

He added: “The perceived risk is much higher than the actual risk, which is why we’re able to offer insurance products for this.

“The good news is that the sharing economy has become mainstream now. When AirBnB was first starting, it was quite unusual and many insurance providers didn’t understand it. 

“Nowadays, so many insurance companies either just allow it, or you pay an additional premium to have it included.”

Any more top tips for renting out space?

If you think renting out storage space might be for you, there’s a certain amount of organisation that should come first.

Dave Sayce, co-founder and director of trade directory Compare My Move, said: “Starting your own storage service is a viable option, and one that can make you a good amount of passive income. However, it’s important to think about both the positives and negatives before committing.

“The room you are renting as storage space will have to be fully secure and be able to store only your client’s items. Mixing up your items and the client’s items can lead to confusion and potential refunds or bad reviews on your part.

“When advertising your space, always be as upfront as possible about where it is, the dimensions of the space, and the security of the area.”

To maximise profits, you should treat your space listing like AirBnB, according to Mr Mantle. 

He said: “You want to really make your listing shine. Simple things like making sure your space is clean and tidy, taking lots of great pictures and writing great descriptions. 

“With a villa or storage space the idea is the same: you want people to see a space they feel comfortable with. 

“Once you’ve got it listed, be really engaging with the people who come through the door. You’re delivering a service to someone. Respond to messages quickly, like the best AirBnB hosts would.”

The key to making money from storage long term on these apps? Getting good reviews. 

“Helping to carry the stuff into the space, being very welcoming – all that helps,” said Mr Mantle. “You get ratings, and those ratings help you get more bookings.”