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21 September 2023
Rent out your parking space
Is your driveway paved with gold? If you live in a big city, near an airport or a train station, it might be. Online parking marketplaces let you rent out car parking spaces – some people earn £200/month or more. Plus if you're looking for a space, they're a handy way to find cheap parking too.
While every effort's been made to ensure this article's accuracy, it doesn't constitute legal advice tailored to your individual circumstances. If you act on it, you acknowledge that you do so at your own risk. We can't assume responsibility and don't accept liability for any loss that may arise as a result of your reliance upon it. Thanks to Crosse + Crosse Solicitors.
Depending on your area, you could net up to £200/month (more in some places, eg, parts of London) just for letting somebody park in your drive or garage. The most covetable spaces tend to be in city centres, but you can still make serious cash elsewhere.
If you live by a big transport link such as an airport or railway station, or even a football ground, it's worth a quick valuation.
To get an idea of what you might be able to make, clever online tools can give quick estimates. You can see what those nearby charge for long-term stays (eg, a month) with Park Let’s price guide tool.
This is purely a rough reckoner though, and won’t necessarily give the highest price. Use the results to help you decide whether it's worth progressing to the next step.
It's also worth noting we’re talking about off-street parking spots on your own property here. Sadly, it breaks almost every council’s rules to simply sell on your residents' parking permit.
Nearly all the big parking sites and P2P parking apps are free to list on, so there's nowt to stop you listing everywhere (P2P or peer-to-peer is where the renting's between individuals rather than companies and customers). But the amount you'll end up with will vary depending on the cut they take, plus any other fees.
Going with one of the bigger sites may mean less hassle and more visibility, plus higher demand should mean you can charge more. But remember the site will take a cut. Before you list, make sure you read our list of things to watch out for below too. Here are the biggies:
An established player, JustPark* has good feedback. Listing is free, but it charges commission when you rent a space out – see below. It has free iOS and Android apps to help drivers find parking on the go.
It sorts out contracts and processes the payments, transferring earnings to your PayPal or bank account, and ensures you get paid even if the driver doesn't turn up. You can rent out spaces by the day, week or month, and add restrictions on when they're unavailable. All users can – and tend to – leave feedback.
Fees: 3% commission, 20% commission on first month of bookings of over two months and 3% thereafter, 50p fee to withdraw earnings of £25 or under.
JustPark offered free parking spaces to NHS workers when the coronavirus pandemic first hit, but this offer has been replaced with a 10% discount for all verified NHS and critical care workers. The discount is available for pre-booked parking only and applies at over 90% of JustPark's locations across the UK.
Another website with a very comprehensive service and good user feedback is ParkLet* (also available as a free app for iOS and Android devices). It's a good one to use if you're looking to rent out your car parking space for a longer period, like a month – however, it is one of the most expensive.
It works like any other letting agent, dealing with all the contracts and processing all the payments itself, so you do get a bit extra for the cash. Listing is free, so fees are only payable if you succeed in renting out your space.
Fees: 30% commission + VAT on daily bookings, 25% + VAT on weekly bookings, 20% + VAT on monthly bookings, plus a one-off £25 + VAT admin fee.
On price alone, Your Parking Space is a winner as it doesn't charge anything for listing your space. It makes money by charging the tenant a 20% fee on top of what you charge, so it doesn't take a penny of your earnings. You can download its free app for iOS and Android devices.
You'll need to work out how much you want to charge (for a guide have a look at similar spaces near you) but it will then organise the rental, answer questions from the person renting your space and automatically send payments to you.
Park On My Drive is basic but cheap. It's free to list your space but you have to pay a yearly registration fee of £20, though this isn't charged until the first booking is made. This means if you don't manage to rent out your space, you won't have to pay it.
Once you pay, you get a calendar page which shows available dates. It provides a rental agreement to fill in and offers a pre-payment system, where the tenant pays a surcharge to Park On My Drive, which in turns organises your payment. It has a review system and you can upload photos of your space.
Fees: £20 per year.
You can list almost anything on free classifieds site Gumtree, including parking spaces. If you live in a popular area, you stand a decent chance of finding a tenant, but you'll have to work out contracts and payments yourself.
You have to pay if you're posting in property, and the amount will vary depending on your ad – see below. As it's a sprawling site, it's unlikely anyone will just happen upon your ad, so it's vital to make an accurate listing which stands out in searches. It has free apps for both iOS and Android devices.
Fees: Depends. We were quoted £8.79 for a basic ad with pictures, but there were extras such as adding an 'urgent' sticker for seven days for £21.99 or putting your ad on the homepage for seven days for £43.99.
Renting out your parking space isn't all plain sailing. There are income tax, insurance and mortgage issues to be aware of, as well as the need to manage your possible liability. Plus be considerate to any neighbours you share a driveway with.
Some more officious local councils have deemed renting out your space a 'change of use' to your property and have asked for hefty planning application fees. But the Government says renting out one parking space without planning permission is fine in England, provided it's not a nuisance to neighbours and there are no other major concerns.
So while there can be a conflict between local councils and the Government on this, ultimately what the Government says goes as it has the final say.
The Ministry of Housing, Communities and Local Government tells us it doesn't believe renting out a parking space is a change of use that needs planning permission, and has published guidance to make this clearer on Gov.uk.
It says that if the council asks for a planning application fee, you should challenge it, and refer the council to the Government planning guidance.
If a council still starts a planning enforcement notice, you've a right of appeal – and planning inspectors that deal with these are expected to follow Government guidance. For how to appeal, check on your local council's website at Gov.uk.
As this only applies to England, it's worth noting that elsewhere it's a grey area, so some local councils may ask you to apply for planning permission to continue doing it. Back in 2013, the Government said it would clamp down on councils' 'backdoor parking taxes'.
A few more things to watch for:
It's important to have a written contract, for instance, to specify you're not responsible for vehicles or items left inside them whilst in your space. As mentioned above, many of the sites will provide contracts for you.
If not, there are free basic agreements available online that you can download and print to help, including a PDF from Park On My Drive. Yet always check you're happy with the situation first, and don't sign anything you're not comfortable with.
Solicitor Zoe Tibbles from Crosse + Crosse LLP says: "The agreement should let you terminate it on a specified amount of notice – say, a week or two – oblige the renter to keep the space tidy and not store items there, or block access with their parking."
This is generally the case, though there are exceptions. Just because it's your parking space, don't underestimate what's happening here. You are agreeing to give a stranger access to your drive, so after that point, they can come and go as they please.
Always carefully consider the safety impact of this – as an extra precaution, if you live alone, especially if you're female, consider having a friend or family member with you when you first meet a new potential renter.
Some warned that if you were, however, renting a large plot of land this could be seen as business and so could have an impact. Others said that as renting out your driveway is a commercial agreement it may exclude any liability cover if something were to happen, to say the car owner or the car.
Buildings insurance may include liability cover in the unlikely event your property collapses and causes damage, though this won't always be the case – if not, you may need a separate liability policy.
If you’ve only got contents insurance, you’re unlikely to be covered for this. Either way, ensure the contract also clearly states you aren’t responsible for any damage, to be on the safe side.
You may need to pay tax on the rent you get for your space, as it counts as income from land and property (rather than self-employment income).
But any cash earned from renting out your space up to £1,000 is exempt from income tax, so you won't need to tell the taxman about any parking space income up to that amount.
If your total annual income from renting out your parking space is over £1,000 then you have to tell HMRC and may need to fill in a tax return.
If you already receive a tax return form. Just include the income in ‘Box 20 – Total rents and other income from property’ on the land and property page. This is all you need to do – you shouldn’t need to contact HMRC separately. If you use a paper return and don’t already have other rental income, you'll need to ask for this page from HMRC.
If you don't already receive a tax return. It might be worth phoning or writing to your tax office to let it know you've a new source of income from renting your parking space. If you do need to pay tax on this income, the tax authorities may deal with this in your PAYE (pay as you earn) code, or could ask you to fill in a tax return. For full info, see Gov.uk.
If you’ve a mortgage, it’s a grey area among mortgage lenders as to whether you need permission from them to rent out your drive, so it’s worth checking the rules with yours first. You could give your lender a quick call in the first instance, noting who you spoke to and when, as a written reply's likely to take much longer.
If you rent rather than own the property, it’s best to check the terms of your tenancy agreement before renting out your space, and get the landlord’s permission in writing. Similarly, if you've leasehold rather than freehold ownership of the property, check the terms of your lease.
Provided the terms don’t prevent it, your landlord agrees, and it’s your own space (ie, not communal) you should be fine to rent out your parking space if you wish.
It’s highly unlikely you’d be able to do this with a communal space, as you’d need written permission from the landlord and all those entitled to use the space – plus as it’s a shared space, you wouldn’t be able to ensure it’d be kept free.
If you drive to work, pay for monthly car parking with one of the big chains, or just pay over the odds for your regular Saturday football space, you might be able to halve parking costs by renting a private space instead. Plus you can get a rough idea of savings in seconds.
Try ParkLet's price guide tool, which lets you search for guideline UK parking prices on a map. Just drag the area you'd like to park in under the 'X'. You'll only find the average though, so even if the saving's good, use it as a benchmark to beat.
Once armed with ParkLet's* best price, compare some of the top 'rent your parking space' sites, which can also be used for renting a space, such as JustPark*, Your Parking Space and Park On My Drive. If you're willing to dig a bit more, you could also try Gumtree. If they can beat the price, you might want to take the plunge, but always consider the following first:
How secure is it? Security is a potential concern when parking privately, especially if you've a flashy motor. Always check the space carefully. It may be possible to pay a little more for underground or garage parking which may be safer.
Can you park cheaper further away? If you're looking for a spot in a city, where rents are the highest, it might be worth casting your net out a little wider. Sometimes you'll find decent price drops by parking just a little bit further from your destination.
Try finding a cheap parking deal that suits your usage. Some people rent out their spaces only at the weekends or in the evenings. So, if you only need the space during that time, it's likely you'll bag a better bargain.
How will you pay? Payment systems vary, as we've explained. JustPark and ParkLet process payments themselves, yet all the other services leave it to you to work out payment with the person letting the space.
Ensure you've a contract. All sites except Gumtree provide contracts, though in that case Park On My Drive has a useful printable contract.
To give you an idea of how much you could save on parking, the table below compares the cost of using a National Car Parks (NCP) car park with using a parking space found via the top 'rent your parking space' sites.
|London WC1 (1)||£230||£216||£230||£150||£156|
|Manchester city centre (2)||£125||£113||£108||£56||£100|
As the table shows, by swapping NCP's season tickets for a private parking space it's possible to cut your parking costs with just a quick search of a few sites.
Clever ways to calculate your finances