AND WE’RE PRIVILEGED TO LIVE AND WORK IN IT
For some time, a phenomenon occurring in American culture and in our economy has been the move away from an acquisitive instinct and buying behavior toward a more experience-oriented motivation. Which means that people – especially younger people – are tending to favor access over ownership. This inclination is manifesting itself in a variety of ways, one of which is an expansion of renting things in the U.S. economy, which was once dominated by purchasing and owning those same things.
Rent-to-own is an adjunct and integral part of this world of renting, and as consumers increasingly opt to rent the stuff they used to buy, the rental pie is getting bigger. Economists and social commentators noted the trend as early as 2012 (just google Rental Nation: How Everything Can Be Borrowed by Joe Mont, March 2012).
Younger consumers in particular are looking to gain experiences rather than amass possessions. The above-mentioned article mentions usership as the new ownership. Home ownership is an excellent example – it’s dramatically declining despite the government’s best efforts to keep it growing.
As the culture develops in ways both positive and negative, the products themselves are becoming less important, even less desirable, than the experiences they offer. Young social influencers boast that when they rent, they can get the lifestyle they want on a budget. The marketplace seems to be responding to this emerging consumer preference for Access Over Ownership.
For example, clothing. People have always been able to rent some kinds of clothes, e.g. Halloween costumes. Today, you can rent clothes for any and every occasion – work, leisure, special occasion, high-dollar designer blue jeans, you name it. The groom has always been able to rent his tuxedo; now, the bride can rent her wedding dress, too – after all, it’s intended to be worn only once. The same concept is behind rental maternity clothes and even women’s shoes.
And the move to using-rather- than-owning has spread much further than the clothes on your back. A fast glance at the wide variety of things folks can rent nowadays offers many examples: purses, textbooks, Segways, backyard playscapes, and even friends, should you find yourself sadly lacking in that arena. Chances are, you’re renting space in (on?) the cloud to store your information, rather than buying bigger, more powerful physical servers. Some offbeat rental opportunities include wedding cakes, coffins ($700 for the day with removable linings for pre-cremation viewings), plants, solar panels, suitcases, sleeping bags, and every sort of sports equipment.
Myriad things may yet be rented at rental yards, from industrial tools to baby cribs. People who go there have short-term needs – a few hours or a few days – for specific items they have no interest in owning. Hence, the rent-to-rent rental yard industry has been around for a long time, and will doubtless continue to live long and prosper.
Of course, you can rent someone’s whole house, guest house, or just a room in their house for your vacation using Airbnb or VRBO. Bicycles and electric scooters can be found on every corner of most American cities, and people rent them with a click of their smart phones. Oh – and of course you can rent your smart phone, too.
Sex robots are about to become available to rent. Enough (maybe too much?) said.
THE MARKETPLACE SEEMS TO BE RESPONDING TO THIS EMERGING CONSUMER PREFERENCE FOR ACCESS OVER OWNERSHIP.
Rent-to-own housing is a burgeoning portion of the residential real-estate market. Governments around the globe, including our own, are using the RTO concept to put people into houses they can one day hope to own without having to come up with a 20% down-payment, which is simply beyond the reach of huge swaths of the population. Rent-to-own housing transactions are not covered by state RTO statutes, and are much more complicated transactions – they involve the creation of a landlord/ tenant relationship in the lease portion of the transaction, then a seller/buyer relationship later on once the purchase option arises, usually following several years of renting.
In the furniture world, new entrants like Fernish, Feather, and others are reimagining the rent-to-rent (RTR) furniture business. About thirty years ago, there was a well-established RTR furniture industry with companies like Cort and Grantree; they catered to executives on assignment, offering apartments full of furniture on longer-term contracts than traditional weekly or monthly rent-to-own. Today, that industry is a shadow of its former self, but new entrants are appearing, aiming at big-city millennials and Gen-Xers, who might move several times each year and don’t want to have to move heavy, cumbersome furniture all around town.
Businesses in which the rental transaction has become conventional include musical instruments and backyard portable buildings. When your middle-school child comes home expressing a desire to play the oboe in the school orchestra, you can go and spend a few thousand on a new oboe, but the better path is probably to rent one to see whether the oboe infatuation sticks or is a passing fancy. You’ll know fairly quickly whether your child is the musical prodigy you secretly believe him to be. If the talent exists and if the passion persists, you can always go buy a brand-new, professional-grade oboe once you’ve returned the rental unit, probably from the same store. The rental unit is serviceable for middle-school orchestra, but has likely seen a lot of lips over the years. The keep rate for rent-to-own musical instruments remains in the low teens. If your child’s passion transfers to another instrument or maybe to soccer, then you can give the oboe back, no harm, no foul. That is, after all, how RTO works. If, wrapped up in your deep-seated belief in your offspring’s God-given talent, you bought the oboe outright, but the budding musician has become enthralled with girls or gangs or video games, then you might end up having to store that beautiful instrument in your catchall backyard shed.
Backyard sheds, by the way, are a booming rent-to-own business. They started small – both the shed dealers and the sheds – but have grown over time. These sheds are not the tin ones that come as a kit and blow away with the first gusty storm. RTO sheds are typically heavy-duty sheds with shingled roofs, solid wood floors, doors, windows, and sturdy enough to last for decades. They often have to be delivered via 18-wheeler, and if not used to store all your extra junk accumulated over the years, then many customers turn them into “she sheds,” “man caves,” or even tiny homes.
Sheds used to cost a couple of thousand dollars and were only big enough to store a lawn mower and some garden tools. Today, sheds can be huge enough to require two semi-truck deliveries, cost tens of thousands of dollars, and can be put on rent-to-own agreements that last up to five or six years to help payments stay manageable. Keep rates are higher for sheds than for musical instruments, or for TVs and appliances. Once a shed gets filled up with a family’s seldom- used detritus, it simply becomes easier to make a payment each month than to have to empty the shed, cancel the deal, and return it. There is, incidentally, a national trade association of just RTO shed dealers – the National Barn and Shed Rental Association.
Interestingly, the rent-to-own shed industry, still in its relative infancy, has several different configurations. A few companies are vertically integrated: They own the land where they grow the trees; they own the mills where they cut the lumber; they own the plants where they build the sheds; they own the lots where they display the sheds; and finally, they carry the RTO agreement when customers rent those sheds. Other rental shed dealers do nothing but sign customers up on rental agreements for sheds owned by others; they buy the shed from the manufacturer or distributor, and rent it to the customer – much like the kiosk model in the TV and appliance world. They might never meet or even see their rent-to-own customers, and trust that having the address where the shed was delivered will be enough protection should the payments stop happening. It is, after all, harder to steal a shed than a TV.
The relentless expansion of the world of rentals might not alter the fundamentals of the rent-to-own business that has grown and prospered by providing the necessities of modern life to consumers who have trouble buying such items outright. Recognizing today’s changing zeitgeist and young consumers’ emphasis on convenience and experience, rental dealers might rethink their product mix and how consumers experience their company. They also must be social-media savvy and have a strong online presence, because the Internet is where Americans are spending more and more and more of their time – and money. If consumers are less and less enamored with owning the things they want to use, and renting those things becomes more and more accessible and familiar, then it can only serve to benefit the rent-to-own industry, because renting things is our business.
RELATIONSHIP RENTALS RISING
While it will never be included in the rent-to-own industry (because human trafficking), renting different sorts of relationships is becoming more and more common – especially with Americans’ growing sense of isolation and loneliness provoked by the pandemic. Here’s a sampling of humans-for-hire opportunities:
PARENTS & GRANDPARENTS
Services like Need a Mom and Rent-A-Dad offer adult clients parental services, from helping you move to listening to your troubles and providing advice. Likewise, Rent-a-Grandma will send over an older woman to do granny stuff, like watching the “grandkids,” pet-sitting, or cooking you a homemade meal.
ROMANTIC WINGMAN
Services like The Professional Wingman are part bar buddy, part romance coach, and part casual therapist. Your rented wingman not only will accompany you into social situations to offer encouragement, distraction, and backup, but also will provide you with strategies for improving your love life.
BRIDESMAIDS & GROOMSMEN
Who rents a stranger to stand up with them at one of the most intimate events in their life? Apparently, a bunch of the betrothed do. Grooms often hire pro groomsmen to balance out a bridesmaid-heavy wedding party, while brides tend to hire bridesmaids for professional-level support and guidance.
GOATS
OK, they’re not human, but they are cute, and excellent lawn-maintenance mechanisms. Yes, you can rent a whole herd of goats – via Amazon.com! – to trim your grass, masticate your weeds, and look bucolic doing it. Bonuses: A gaggle of goats can be much cheaper than hiring a landscaping company, and the goats’ work is 100% natural and ecologically sound.
Kristen Card has been a contributing writer for RTOHQ: The Magazine for more than 15 years.
