Renting

Renting is a formal agreement for the use of a good, service, or property. The person using the item is called the tenant. The person who owns the item is called the landlord. In this arrangement, the tenant makes a payment to the landlord for a fixed period of time. Most people use a written contract to establish the specific roles and expectations for both parties. This document is governed by contract law to ensure everyone follows the agreed terms.

There are different ways to categorize these agreements based on their duration. A rental agreement usually refers to short-term use. In contrast, a lease refers to a longer-term arrangement, often known as leasing. While real estate law governs the renting of land or buildings, other types of property fall under different rules. For example, renting personal property, or chattels, is typically covered by general contract law. However, the term lease is also used today for long-term rentals of expensive items like automobiles or planes.

People choose to rent for many practical and financial reasons. Sometimes, renting is a necessity because a person cannot afford to purchase a home. In many places like the United States, Australia, and the United Kingdom, rent paid for a business is tax-deductible. This can help companies manage their finances more effectively. Renting also reduces financial risk related to depreciation, which is the loss of value over time. If a person only needs a tool or a truck temporarily, renting is more efficient than buying.

Environmental benefits are another significant reason for the growth of renting. When products are rented, they can be used more efficiently by maximizing their utility. This helps prevent items from being overproduced, underutilized, or disposed of too quickly. Renting can also remove the burden of maintenance from the tenant. For instance, a tenant might prefer that the landlord handles tasks like mowing the lawn or shoveling snow. For businesses, renting keeps debt off the balance sheet, which is a record of a company's financial health.

History shows that the concept of rent is very old. Roman law included several specific types of rent. They used the term canon for rent under long leasehold tenure known as Emphyteusis. They also had reditus for renting a farm and solarium for ground-rent. There was vectigal for the rent of state lands. They even had prensio, which was an annual rent for the jus superficiarum. This term refers to the right to the perpetual enjoyment of anything built on the surface of land.

The rental industry is a massive global market. In Europe, the short-term rental of products—excluding real estate—is an annual market worth approximately €108 billion, or about $160 billion. The internet has helped this industry grow by making it easier to find items. A YouGov poll found that 76% of people looking to rent would use the internet first. This number rises to 88% for people aged 25 to 34. Some people are moving away from ownership entirely; a 2010 US survey found that 27% of renters plan to never buy a home.

There are many different types of items that can be rented or leased. For real estate, people rent apartments, houses, or even just a parking space. For transport, people rent automobiles, bicycles, ships, or aircraft. When renting a ship, the process is called chartering, and the payment is called hire or freight. Other examples include specialized tools like forklifts, or consumer goods like designer handbags and jewelry. Some rentals even include services, such as staying in a hotel or riding in a taxicab.

To protect the owner, rental agreements often include specific safeguards. A tenant might need to show an identity document or sign a formal contract. Many rentals require a damage deposit, which is a refundable fee used to cover any harm caused to the item. Some companies use social control by marking their goods with signs that cannot be easily removed. This makes it obvious to the public that the item belongs to the rental company. In some cases, such as renting a crane, the fee includes the cost of a professional operator. This is sometimes called a wet rental.