US Rent-to-Own Market Report 2022: Surging Internet Penetration Boosting Awareness and Driving Growth
DUBLIN, Dec. 6, 2022 /PRNewswire/ -- The "The US Rent-to-Own Market: Analysis By Distribution Channel (Brick & Mortar and E-commerce), Size & Forecast with Impact Analysis of COVID-19 and Forecast up to 2027" report has been added to ResearchAndMarkets.com's offering.
Rent-to-own (also known as "lease purchase") is a contract that allows prospective buyers to lease a home with the option to purchase it later. The tenant/buyer pays the landlord/seller an amount equal to the rental amount on a monthly basis. A portion of the monthly payment is then applied to the home's purchase price. During or at the end of the lease period, the tenant/buyer has the exclusive right to purchase the home on the terms agreed upon by both parties. In 2021, the US rent-to-own market was valued at US$10.48 billion, and is probable to reach US$15.53 billion by 2027.
The rent-to-own industry is anticipated to showcase a positive outlook during the forecasted years as primary and subprime lenders would tighten credit measures. Furthermore, demand for essential products (appliances and computers) is increasing and would further intensify in the approaching times. The US rent-to-own market is projected to grow at a CAGR of 6.77%, during the forecast period of 2022-2027.
Market Segmentation Analysis:
By Distribution Channel:
The report splits the US rent-to-own market into two distribution channel: Brick & Mortar and E-commerce. E-commerce channel held a share of 41% of the market share in 2021 and is expected to grow at a CAGR of 10.08%, in the forecasted period. Stay at home and social distancing orders have been imposed all across the US due to the outbreak of COVID-19. This in turn has led to more and more people preferring e-commerce chnnels for purchasing various things on lease.
The US rent-to-own Market Dynamics:
Growth Drivers: The rising urban population resulted in a positive influence on rent-to-own market. Consumers find it more stress-free and convenient way to use rent-to-own services instead of buying the products as there is the possibility of shifting to different locations for different reasons. Further, the market is expected to increase due to significant population of international migrants, surging GDP growth, rising disposable income, growing millennial population, rising virtual rent-to-own market, etc.
Challenges: Rent-to-own facilities is tailed by various issues such as lack of customer security. For example, a lease-option is accompanied by similar risks for tenants/buyers as a traditional mortgage, excluding the benefit of potential recovery. The other challenge that the US rent-to-own market face is dependency on vendors, suppliers and products, low profit margin, etc.
Trends: A major trend gaining pace in the US rent-to-own market is hike in internet penetration. With increasing use of internet in all phases of life, people have been able to reach and compare many products and knowledge on various industries provided on internet. This opportunity is seized by many rent-to-own companies and they are now providing all the information regarding the new launched services and existing services on the internet. More trends in the market are believed to augment the growth of the US rent-to-own market during the forecasted period include rollout of smartphone as new category, rapid pace in technological advancements, etc.
Impact Analysis of COVID-19 and Way Forward:
The epidemic of Coronavirus illness (COVID-19) had a significant impact on the US rent-to-own market, as governments around the world implemented lockdowns. However, the market's total impact was favorable in 2020. The enterprises saw a loss in revenue for the first quarter of the year, however the industry recovered due to increased demand for house ownership, higher rental prices, and other factors. The rent-to-own industry in the US is likely to grow further in the future, owing to the rapid speed of technology improvements, more e-commerce in home purchases, and so on.
1. Executive Summary
For more information about this report visit https://www.researchandmarkets.com/r/gamqs2
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