Hear me out -
Over the course of next few months/years we will be visiting Portugal multiple times. And some if not most of these times we will need 4-wheel transportation. Looking at the car rental prices we have been considering buying a car and renting it out on something like Turo while we are not using the car.
Does something like this exist already in terms of rental car management when the host is not present? I feel like this would be vastly cheaper than renting a car multiple times a year over the next few years.
So storage. Insurance. Maintenance. and then dealing with the police whenb someone runs a pedestrian down. Car hire or sole ownership may cost a little more but lets you sleep at night.
There areservices here in the US that manage your car on Turo or Hyre. Perhaps there are similar services in Portugal.
I agree with above regarding owning a car and renting out when you are not there. Things to take into consideration… particularly with renting to others:
- Fixed costs (and the headache to deal with them): via verde transponders/tolls, regular mechanical maintenance, cleaning inside/out before each rental, insurance, safety checks, licensing/taxes annually. Some of these will vary greatly depending upon the age of vehicle. The older it gets the higher the costs and the more annual regulatory requirements for emissions and safety.
Side note: Your insurance company may not insure you if you are using your car as a rental.
- Remember the adage: “don’t be gentle, it’s a rental.” Especially if you are talking 4WD vehicles. The wear and tear from someone else who doesn’t care what happens to your car could result in a pretty messed up vehicle the next time you return to use it. (scratches/chips in paint, dents, spills of whatever, tears in fabrics, broken trim inside/outside, smoke small, other stinky smells from who knows what that just won’t go away, etc)
Keep in mind, the renter’s rental car insurance usually would not cover anything except major damage (and usually the coverage is capped with anything above it your responsibility), so fixing/cleaning any of that comes out of your pocket—not to mention the headache of actually getting it fixed.
Also, the more wear and tear shown on the vehicle, the less renters will treat the car well, so the damage/wear and tear compounds on itself… have you seen the state of the rental vehicles in Portugal?
- Be careful from where you purchase - our lawyers and also several local friends said to stay away from the used car dealers you see around town. Buying a used car is risky - tampering with odometers is common, and mechanical issues, history, etc. is often obscured and you can’t just pull a VIN history to see what the car has really been through inits lifetime.
It was recommended to us to stick to places like Hertz used cars, CarNext, and other larger international reputable rental/sales firms that offer warranties, if wanting to buy a used car. Note that when we looked in January, used cars were quite scarce and about 1.5X - 2X usual market value due to various market conditions.
New car inventories are down and if you are looking for a specialty vehicle (e.g. electric or 4WD, the wait could be 6 - 18 months). We bought new in January, and just by dumb luck we found one that the order had fallen through in Germany so had it imported.
What are the taxes on the rental income and will you need to hire an accountant? Will you need to have a business license to rent it out like you need to with short term vacation rental properties? (Even if you are not a tax resident under the GV or NHR schemes, taxes will need to be paid/declared/files somewhere).
Then there are the liability risks mentioned by the previous poster… you will want to talk to a lawyer to make sure you don’t have exposure (I would not trust the rental management service to answer that for you as they have no incentive to tell you all of your exposure risks).
Thank you for the detailed responses, this conversation has been super helpful to me. (And hopefully to others)
Puts things in perspective to counter my knee jerk reaction of buying a car outright.