I agree it wouldn't be worth the paperwork for a single item, but owners could make a living renting out many items, perhaps even buying popular items to rent.

And as you suggest, the site would need to make dispute resolution as simple as possible. Perhaps automatically refunding both sides for disputes, but banning users with too many disputes.

It's not simple--certainly not as simple as publishing free ads--but that's why a business that can do it is valuable.