How to politely tell this guy to leave me alone?

Unfortunately, being polite might not be an option. you're a nice person and you don't want to hurt his feelings even though he has no problem hurting yours. In the future you'll come across many people willing to take advantage of your kindness, so unless if you want to be stepped on your whole life, it's important to have a backbone and say NO for your own happiness. You have the choice to block this person, the next time he asks for something just say "If you want it, you can buy it yourself" and if he cusses you out then you can reply "Stop harassing me, it's upsetting and if you continue i'll have to block you". It's perfectly ok to ignore someone who looks down to you, you don't need to reason or sort things out. It's OK that he lives next door as long as he doesn't show up at your house (you should call the police if he does), just pretend not to notice him