Rather than leaving your vehicle lying idle when you’re not touring, you could rent out your campervan for extra revenue. Peter Rosenthal weighs up the pros and cons
By Practical Motorhome
Many motorhomes remain idle for some 95% of their lifetime, according to estimates by one hire firm, and it does seem wasteful to have a ‘van and then only use it sporadically. You still have to pay insurance and tax, and leaving it standing for long periods never does any good mechanically. This is where renting out your motorhome can come in.
Times are tough for everyone at the moment and what with rising energy prices, war and economic turbulence, we all need to save cash and find new ways to make money.
So on the face of it, renting out your motorhome is a bit of a no-brainer. Rather than your ’van simply sitting dormant, why not let another family have the use of it – and pay you for the privilege? In theory, it could make you money and in effect, provide you with free holidays and free motoring.
But what do you need to know before embarking down the rental route? And what are the pros and cons of renting out your campervan?
What can you earn?
Some motorhome hire firms offer an earnings calculator, allowing you to work out average earnings from hiring. For example, on the Camplify website, my Renault Trafic campervan (2016, four-berth) could earn up to £295 per week, based on 40% occupancy and minus their 10% commission. So it could be as high as £15,430 per year if the vehicle were in constant use.
In practice, you’re unlikely to earn this much if you’re renting out your campervan – bookings invariably drop off over winter and you’ll also want to use your own vehicle yourself. Camplify reckons that people can earn up to £10,000 a year by hiring out.
Camptoo says it can hire out your vehicle for an average of 40 nights per year, with a four-berth camper typically earning £676 a week.
At £96.57 per day, that can equate to £3862 per year for 40 nights, enough to pay for your annual insurance and several good holidays.
These are potential earnings, though – there is no guarantee of how many nights you’ll get per year, or how popular your vehicle will be. As you’d expect, the UK summer holidays and Easter are peak hiring times, together with events such as Glastonbury. If required, you will also need to pay tax on rental income.
Private hire
You can, of course, set up your own website or social media page and hire out your vehicle yourself.
You’ll need to arrange an insurance policy for each hirer and establish your own terms and conditions of hire, as well as checking the hirer’s identity (passport), home address (utility bills) and driving licence. To check a driving licence, visit gov.uk/check-driving-information and obtain the last eight characters of the hirer’s licence, anda check code, which the driver supplies. The driver has to visit gov.uk/view-driving-licence and provide their full driving licence number, NI number and postcode. They can then give you a share code, which permits you to check their licence.
For overseas drivers, the procedure is different and you’re advised to go through a hire company, rather than committing to a private hire yourself.
Bear in mind that these documents can be forged or stolen, so just carrying out these checks isn’t always going to be as conclusive as you might think.
Criminals are often charming and intelligent people, too, so assessing their character on the phone might not be that effective, either.
The warning signs are when the hirer wants to do several things out of the ordinary – have the vehicle dropped off somewhere else, pay via Western Union, or have it collected by a third party. If in doubt, don’t do it.
There are two main risks: anyone misrepresenting themselves might not be covered by insurance (that is, they have a driving ban) or, worse still, they’re planning to steal the vehicle.
It’s equally critical to take a cleared security deposit – typically a sum from £500 to £1000.
All hire ’vans need to have a quality tracking device fitted to improve the motorhome security, but even these are no guarantee against professional criminals, who have ways of disarming most anti-theft systems.
Even if you’re simply renting your vehicle to friends and family, with all the proper insurances in place, things might not go well. Should accidents or damage occur to the vehicle – and money be involved – there is a high risk of problems. Financial involvement with family or friends is never a good idea and can result in lost friendships. Tread carefully with people you know.
Clearly labelled controls, together with a clear instruction booklet, are important, too, as well as a thorough handover detailing all major controls. Clearly label the height, width, length and weight of the vehicle on a large sticker visible from the driver’s seat.
For all of these reasons, it is wise to rent your vehicle out via an established hire firm, which will have encountered these problems before and will be more experienced in dealing with them.
Terms and conditions
Whether you’re thinking of hiring out your motorhome privately or go via a peer-to-peer firm, you’ll need to set out the terms and conditions of hire very clearly.
Typically, hirers need to be aged over 25, have a full UK driving licence for the vehicle they intend to hire and be licensed to drive manual or automatic vehicles, depending on the licence.
For vehicles over 3500kg, they will need a C1 category on their licence.
Drivers ideally need to have held the licence for at least two years and had no fault claims (or a maximum number as determined by your insurers) within the past five years. Also ideally, they need to have a licence free from points (although some insurers accept up to six points for minor offences).
It’s wise to get two forms of proof of address for each driver (which must match each driving licence), as well as a cleared security deposit via a credit or debit card, BACs, PayPal or cheque.
This security deposit will be taken either by you or via the motorhome rental firm you are listed with, and is generally between £500 and £1000, depending on the hire vehicle value.
The number of occupants in the vehicle must match the number of seatbelts (ideally only three-point belts facing forwards or backwards and in seats tested to a minimum of M1 in the UK). Seats must be suitable for infants if the hirer plans to use child seats. You’ll also need to decide if you want to allow pets on board as well. Again, these will need to be safely secured while in transit.
People can be very litigious these days, so careful attention needs to be paid to all safety aspects of the vehicle – everything from ensuring it has no trip hazards or sharp edges, to making sure the seatbelts are secure and the gas and electricity, fire extinguishers, carbon monoxide detectors and smoke alarms all function as they should.
The ’van must be serviced at regular intervals and have an annual habitation service, as well as an electrical safety check. The paperwork for this must be retained each year.
Renting out your motorhome via a hire company
Also known as peer-to-peer hire, this involves signing up to a motorhome website, which will then market and list your vehicle for you.
In addition, they vet the customer, deal with the financial transactions and handle the insurance.
Most will include comprehensive insurance (although some require you to organise this yourself) and carry out licence and ID checks. They’re usually free to join and you simply pay the firm a commission when your ’van is hired.
The advantages are that you don’t need to spend money on a website and worry about money transactions or marketing costs, but equally, being one step removed from the customer means that you will be relying heavily on the websites’ vetting procedures.
Different firms charge different levels of commission – typically ranging from 10% to 22% – and offer varying levels of client vetting. So before signing up with a company, do your homework online about them and try to speak to fellow motorhome providers, to gauge their experience with the firm.
Insurance, finance and warranties
Be warned – most standard insurance policies will specifically exclude hiring out your vehicle for any form of remuneration, and even if you’re only lending your motorhome to friends, you do need to check if they will be fully insured while using the vehicle. If you charge them, you will, in effect, void your own insurance. They may well be covered for third party on a separate policy, but this won’t cover you against damage to your vehicle.
If you hire out your motorhome via a specialist third-party hiring website, you should be covered by their insurance, but it’s still important to take a very close look at the details of the cover provided. For example, Goboony offers separate insurance for your vehicle, but this comes with higher excesses for hire use. A vehicle valued at £30,000 to £65,000 will carry an excess of £2000 with Goboony’s policy, while a camper valued at less than £10,000 has a £1000 excess.
Generally, the excess for a regular motorhome policy will be in the £100 to £350 region, so this is quite a big increase in your costs, should anything untoward happen to your vehicle.
With all peer-to-peer motorhome hire insurance policies, you’ll need to go through the documentation with a fine-tooth comb to see precisely what is covered – for example, sometimes windscreen cover is excluded, which can be massively costly on an A-class. As ever, the devil is in the detail.
If you have a motorhome that has an existing and current warranty, you should also carefully check in the terms and conditions whether this will be affected by renting out your motorhome – not doing so could prove very costly in the event of a claim.
Likewise, if you have taken out finance on your vehicle, the financial provider should be informed before proceeding: renting out your motorhome may be against the terms and conditions of your agreement.
HMRC and tax implications
Renting out your motorhome for remuneration will (if you’re a UK tax payer) require you to inform HMRC and pay tax if certain thresholds are reached. You should keep full records of all transactions and inform HMRC of all taxable income.
Festivals and events
While you can charge a premium price for hiring out your vehicle for a specific event or festival, such as Glastonbury or Goodwood, it’s worth considering the risks of doing so.
For example, at youth-orientated music festivals, there is likely to be a far higher prevalence of drink and even drugs around, which will increase the likelihood of potential damage to your vehicle.
Basically, it pays to be aware of which festivals and events are taking place. Some customers might not want to be completely honest about where they are taking your ’van, so it’s well worth knowing the calendar of popular events being held each year, to be forewarned of this problem.
Although most hire companies will have insurance in place to cover you for rectifying spilled drink or other damage, you need to read through the terms and conditions of their policies very carefully, to see precisely what is covered, and what is not.
Wear and tear
Generally, wear and tear will not be covered by the insurance policy, so you do need to be prepared to spend more per year on any running repairs that might be required.
Although common breakdowns, such as punctures or flat batteries, can often be covered by breakdown cover, you do need to know what level of cover is being provided to the hirer
via the rental firm.
If you hire out your ’van directly, you are most likely to be the customer’s first port of call, so you will need to be prepared to deal with issues yourself.
Should you hire out your motorhome?
If your motorhome is your absolute pride and joy and you’re fairly precious about it, hiring it out to third parties might not suit you at all – it’s pretty much inevitable that customers will not look after it as carefully as you do. You need to think very pragmatically about this before you decide.
Even with the most careful hirers, there are a lot of systems and gadgets to understand in a leisure vehicle and it’s all too easy for them to inadvertently damage something.
As many motorhomes are not really designed for full-time use, regular use will also see a higher chance of failure in certain components.
Cupboard doors, hinges and latches, together with soft furnishings, often bear the brunt of extensive use, while cracked shower trays are another common occurrence.
Given the high cost of excesses on insurance policies for accidental damage, it’s unlikely to be worthwhile claiming for it, or having costly downtime while you wait for repairs to be done.
If you’re not that handy with the spanners yourself, you’ll need to find someone local to you who is – minor damage and wear and tear problems are the cost of doing business whenit comes to hiring out vehicles.
Don’t forget to keep an eye on things such as your motorhome tyre pressure too.
If your ’van is very personal to you, it might not suit you to hire it out. Instead, you could consider buying a vehicle specifically for renting.
Another concern – particularly with direct hire – is that you will invariably be called by the customer if they have any problems with the vehicle.
For example, if they can’t figure out how the heating works, or if the gas bottle runs out, they’ll call you. These calls can come at any time – they will have paid a considerable sum for the hire and won’t hesitate to ring – so you need to be prepared for this.
A comprehensive handover procedure at the point of collection can help you to get around many of these matters, but as we all know, motorhomes are complicated beasts and there’s a lot of information to take in.
Having clearly labelled controls and keeping a detailed hiring handbook in the vehicle is an excellent way to lessen the potential impact of such problems, but of course, it’s not infallible.
So, is renting out your motorhome worth it?
Renting out a motorhome is not without potential problems, but if you go into it with a pragmatic attitude and don’t mind having to deal with no-shows and the odd bit of minor damage, it can provide useful extra revenue.
In our opinion, it’s best to do this via a specialist peer-to-peer hiring firm, preferably one which has been in business for years – they can alleviate the headaches and have the experience to make things run more smoothly.
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Peer-to-peer motorhome hire firms:
Images: Sam and Peter Rosenthal
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