Renting

Renting, also known as hiring or letting, is an agreement where a payment is made for the temporary use of a good, service or property owned by another. A gross lease is when the tenant pays a flat rental amount and the landlord pays for all property charges regularly incurred by the ownership. An example of renting is equipment rental. Renting can be an example of the sharing economy.

In many jurisdictions (including India, Spain, Australia, United Kingdom and the United States) rent paid in a trade or business is tax deductible, whereas rent on a dwelling is not tax-deductible in most jurisdictions.

Short-term rental of all sorts of products (excluding real estate and holiday apartments) already represents an estimated 108 billion ($160 billion) annual market in Europe and is expected to grow further as the internet makes it easier to find specific items available for rent. According to a poll by YouGov, 76% of people looking to rent would go to the internet first to find what they need; rising to 88% for those aged 2534.

It has been widely reported that the financial crisis of 20072010 may have contributed to the rapid growth of online rental marketplaces, such as erento, as consumers are more likely to consider renting instead of buying in times of financial hardship. Environmental concerns, fast depreciation of goods, and a more transient workforce also mean that consumers are increasingly searching for rentals online.

Net income received, or losses suffered, by an investor from renting of one or two properties is subject to idiosyncratic risk due to the numerous things that can happen to real property and variable behavior of tenants.

Examples include letting out real estate (real property) for the purpose of housing tenure (where the tenant rents a residence to live in), parking space for a vehicle(s), storage space, whole or portions of properties for business, agricultural, institutional, or government use, or other reasons.

In certain types of rental (sometimes known as operated or wet rental) the charge may be calculated by the rental charge + timesheets of operators or drivers supplied by the rental company to operate the equipment. This is particularly relevant for crane rental companies.

Rental of personal property or real property for periods longer than a year, which is governed by the signing of a lease, is known as leasing. Leasing is usually used for high-value capital equipment, both in business and by consumers. A lease in which the renter benefits from an increase in value of the asset is known as a finance lease. A leasing agreement which is not a finance lease is known as an operating lease.

Rent-to-own, a term used in the United States for rental of furniture or appliances. The term is also used in the US for real estate transactions, where the tenant has an option to purchase the property at a fixed price at a specified future time. Such arrangements are also known as lease-option, lease-to-own or lease to purchase option.

 

 


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