Did you know that the price of cars has remained relatively flat in recent years? This is most likely due to an increasing number of families owning two or more vehicles, which is a result of modern households having at least two income earners rather than just one.
To provide some more recent figures, the Daily Mail reported in 2012 that the number of homes with four or more cars has exceeded 50%. Similarly, despite a recent dip, research has indicated that the average American household owns at least two vehicles. European households, in fact, own even more.
However, with this extra material wealth, comes a problem – the cost of owning a car is considerable. Between car insurance, the ever-fluctuating price of gasoline, the expense associated with regular upkeep, owning a lot of automobiles can be a financial drain. Furthermore, owning extra cars, or depending on your life circumstances, owning any car at all, may become totally unneeded.
After all, with the advent of ridesharing services, provided by companies such as Lyft, Uber, and Sidecar, getting to work, grocery stores, retail establishments, or other locations by hailing a ride via an app is incredibly cheap and convenient.
In fact, a study released by the University of Michigan Transportation Research Institute has found that ridesharing services are drastically reducing the number of cars being sold today. Other research suggests that as few as 20% of Americans will own a car by the year 2030! In turn, this will likely shrink the size of the used car market in the future, and promotes a very serious question – what to do with the extra vehicle in your driveway?
The Cost of Keeping an Extra Vehicle
On its face, there is some sense in simply keeping an extra vehicle lying around. After all, should the current car you are using breakdown, you’ve already got a spare ready to go. On top of that, most relatively new vehicles are worth a lot of money and a good non-taxable asset to hold onto. However, upon further consideration, this seemingly intuitive answer has a number of problems.
First, depending on their age, make and model, cars can be incredibly expensive just to maintain. Initially, many models cost just a few hundred dollars a year with minimal upkeep to maintain – with some vehicles only needing about $10. However, after a decade some cars will need over a thousand dollars in order to keep it in working order.
Of course, that’s just the mechanical upkeep costs let alone the cost of renewed registration and insurance. Add those expenses and the cost of buying an extra vehicle while keeping up with all related expenses is actually like purchasing two cars additional cars. To clarify, the average American spends roughly 5% on their income on a car, while another 5% is spent on maintenance costs, plus insurance and concomitant expenses.
Second, cars are an asset which depreciates over time. In other words, the older a car gets, the lower its value becomes. Since automobiles are complex mechanical devices, they are subject to immense wear even after little use. Of course, the initial cost of simple car repair isn’t much, but as we’ve seen over time the cost can become unmanageable. Further, like all machines, without a complete overhaul, a car will reach a point where it will irreparably breakdown.
If you do have repairs that need to get taken care of, you should think about calling YourMechanic to have an on-demand mechanic come give you a quote and save up to 30% on your repairs. Who has time to sit at a mechanic shop anymore?
In summary, vehicle wear, combined with other factors, are the reason automobiles hemorrhage value. As a consequence, on average, cars lose about 20% of their worth every single year. As a result, most vehicles may be more valuable if chopped up and sold for spare parts than as a whole car after depending on its condition and age.
Third, even if your extra car is not that old and you can endure the maintenance costs, it will still need to be driven regularly to continue its upkeep. Without being driven once or twice a week, prolonged inactivity may shorten a car’s battery life.
Depending on where the car sits, the paint may be adversely affected. For instance, a car left to sit under harsh sunlight might fade the paint job, whereas a car parked under a tree may have a damaged exterior due to dripping tree sap.
On top of that, the vehicle’s frame may begin to rust, which could corrode the frame. If severe enough, the frame may crack, making your care illegal to sell in some jurisdictions. Other problems which may arise include reduced engine performance, tire deflation and the gas tank may begin to degrade.
Even a car which is physically in great shape may not even start, if left to sit idle for too long. In conclusion, an extra car is an asset far too valuable to just hold onto.
The Pros and Cons of Selling an Additional Car
Of course, the next solution would be to sell the additional car outright. However, it is worth noting that this option has a series of noteworthy positives which should be examined.
First, the most obvious benefit of selling an extra car outright is the immediate source of cash. Of course, doing it sooner rather than later is of benefit because you don’t have to worry about effectively losing money due to depreciation or an unexpected drop in automobile price as a result of other market forces.
Further, if you have the skills and are willing to invest a little bit of extra cash, you may be able to sell your car well over market value. Even if you don’t know how to flip a car now, there are excellent tutorials which provide instruction on how to start.
On net, selling an additional car may seem like the ideal solution to the problem we’ve been discussing, but there does exist another, more profitable option: vehicle sharing.
Renting Out Your Car – A Lucrative Alternative
A new and particularly remunerative addition to the sharing economy and a compliment to ridesharing services, car renting is a fantastic alternative to letting your car decay or trying to get some quick scratch by selling it. Just like people use web services like AirBnB to rent out space in their home to tourists, ridesharing services, such as HyreCar, network those with vehicles they aren’t using to individuals looking to work as Uber or Lyft drivers.
By simply registering your extra vehicle with HyreCar, your automobile will be rented out to trustworthy individuals who will use your car exclusively to make money by driving for companies like Uber and Lyft. A portion of the driver’s earnings are sent to HyreCar and to you; that way, everyone makes money.
Although individual incomes vary, you as the vehicle owner earn 85% of the total rental fee, plus any additional mileage charges which may apply. Furthermore, you can set the daily, weekly, and monthly rental fees and even hand select the drivers when they apply for your vehicle. Each driver must pass a thorough background check before they can rent a car, ensuring that only drivers with a clean driving and criminal record are eligible.
Consequently, renting your spare car can yield hundreds of extra dollars every single month. Over the course of a year, that nets more than what you might have received by selling your car. In fact, In certain circumstances, some car owners have earned as much as $12,000 per year!
What Are HyreCar’s Requirements?
Like any company, HyreCar does have certain limitations on applicants, but they are simple to understand and most prospective cars are accepted. As long as the vehicle meets Uber and Lyft’s minimum requirements in your area, you will be able to rent it out make extremely easy passive income. Plus, HyreCar provides the insurance of the vehicle, so you’re covered.
All drivers are extensively screened to eliminate any reckless or irresponsible driving. All prospective applicants are required to submit their driver’s license, driving history, and are screened to confirm their identities.
Since all registered HyreCar drivers are sure to be responsible, you can have peace of mind knowing that your car is both going to be taken care of and you are going to be earning passive income without any additional effort.
Even if the vehicle is damaged by the renter, you don’t have to worry. Given the way in which HyreCar’s terms and conditions are structured you are not liable for some other person’s mistake. All extensive non-pre existing damage is filed under the driver’s policy for repair. In addition to that, all tolls and tickets incurred by the renting driver will be paid by the driver.
To make things even better, there is no requirement to continually contract with HyreCar. Neither owners nor renters have to go through lengthy contracts, and there are no sign up fees. Applications are processed quickly, so there is virtually no need to wait for approval. Also, as an owner, you will be paid before each rental period, which ensures money in your pocket.
That means within a matter of days, your car will be partnered with responsible drivers and you’ll have a steady source of income all by simply renting your car instead of selling it.
What about the deductible? I’ve heard people say that the a seperate driver hits my car or my renter/driver renting your car can not come up with the deductible. Then what happens?
A $2,500 deductible will be applied to the Driver for physical damage claims. Each case is evaluated individually in the case that the driver can not pay the full amount up front. They will typically be put on a payment plan have have the full amount paid off as quickly as possible.
We’re leaving the country for a year, can we rent out our car for a long term?
You can but you will need someone local to manage the vehicle incase a driver wants to return it.