Rentomojo: 2BHK rental costs less for up to 33 months

Rentomojo’s commissioned industry report finds that renting a complete two-bedroom, hall and kitchen, or 2BHK, furniture-and-appliance package costs less than outright purchase or a 24-month equated monthly instalment, or EMI, purchase for up to 33 months. India’s average urban housing rental tenancy was 19 months in CY2025, 14 months below that threshold.

Why is Rentomojo rental cheaper than buying for 33 months?

Rentomojo’s comparison puts the two-year rental cost of a standard 2BHK setup at approximately Rs 3.33 lakh, against approximately Rs 4.02 lakh for outright purchase and approximately Rs 4.41 lakh for a two-year EMI purchase. The 24-month EMI illustration assumes an interest rate of approximately 16%, based on rates offered by leading e-commerce platforms as of December 2025.

The 33-month result comes from total cost of ownership, or TCO, rather than monthly rental charges alone. Rentomojo’s TCO includes purchase or EMI payments, the opportunity cost of capital, annual maintenance and repair costs, and relocation costs; rental includes recurring payments and their opportunity cost, while a rental security deposit is assumed to be 100% refundable. Ownership becomes more cost-efficient after approximately 33 months because its initial cost is spread over a longer period of use.

The illustrative 2BHK contains two beds, two mattresses, a sofa, two wardrobes, a refrigerator, washing machine, television, centre table, dining table, two study tables and chairs, water purifier, microwave, television unit, shoe rack and two bedside tables. This product mix matters because the analysis is not a comparison of a single appliance or a partly furnished home, and purchase prices, EMI rates and rental prices were sourced in December 2025 from leading Indian e-commerce and rental platforms.

How does Rentomojo’s 33-month threshold compare with tenancy?

Rentomojo’s 33-month rental-cost threshold exceeds India’s 19-month average urban housing rental tenancy in CY2025. Average tenancy declined from approximately 1.8 years in CY2021 to approximately 1.6 years, or 19 months, in CY2025; metro tenancy declined from approximately 1.8 years to approximately 1.3 years over the same period.

The comparison is significant because Rentomojo’s model assumes a 100% probability that owned assets are relocated. It uses a weighted average of intra-city and inter-city moving costs of approximately Rs 20,000 to Rs 25,000 for bought furniture and appliances, while rental providers generally manage relocation without an additional charge. The report says a single relocation can cost as much as approximately two months of rental subscription payments.

India’s rental housing stock creates the setting for this mobility-based calculation. Rental-owned homes accounted for approximately 43 million houses, or 29% of urban housing stock, in CY2025, compared with approximately 21 million houses in CY2011; typical rental contracts were 11 months. A contract renewal need not involve moving, but shorter average tenancy increases the likelihood that renters face the removal, resale and replacement costs included in the TCO method.

Which costs and services create the rental difference?

Rentomojo identifies upfront funding, maintenance, upgrades and relocation as the main differences between rental and ownership. Outright purchase carries the highest initial funds requirement, EMI purchase creates a fixed repayment liability, and rental requires lower initial cash outflow. The comparison table also uses a fixed-deposit opportunity-cost concept of approximately 6% for capital committed upfront.

Maintenance changes the calculation after original equipment manufacturer, or OEM, warranty coverage expires. Rentomojo states that purchased furniture and appliances generally have OEM warranties of one to three years, after which customers bear maintenance and repair costs estimated at 1% to 2% of product cost. Rental plans instead place maintenance, repair and replacement with the vendor, so the projected benefit requires the provider to deliver those services under the contracted terms.

Water purifiers illustrate the service element in a lower-value category. Rentomojo estimates annual maintenance contract, or AMC, and repair costs of approximately Rs 3,000 to Rs 3,500, or approximately 40% of product value, while purifier rental plans start at approximately Rs 4,500 a year. Its two-year comparison puts rental at approximately Rs 9,384, versus approximately Rs 12,544 for full-payment purchase, approximately Rs 14,110 for EMI purchase and approximately Rs 25,530 for bottled-water subscription; opportunity and relocation costs are excluded from that comparison.

Which households are most likely to fit Rentomojo’s model?

Rentomojo identifies lower-middle- and upper-middle-income renters in metro and Tier 1 cities as early adopters of flexible ownership. The report estimates approximately 53 million budget-constrained renter households, including aspirers earning Rs 3 lakh to Rs 10 lakh annually in metros and Tier 1 cities and affluent Tier 1 households earning Rs 10 lakh to Rs 20 lakh annually; it also identifies approximately 7 million high-income renter households.

Affordability is part of the model’s demand case. Household savings were approximately 18% of gross domestic product in Fiscal 2024, while 60% to 65% of household spending went to necessities including food, transport and housing. Furnishing a standard one-bedroom, hall and kitchen, or 1BHK, apartment in India required more than eight to nine months of average income in CY2025, compared with one to four months in the international markets cited by the report.

Supply conditions also matter because approximately 80% of Indian rental homes were semi-furnished or unfurnished in CY2025, leaving tenants to source essential furniture and appliances. Rentomojo notes that rented goods may be perceived as refurbished, while purchase offers a greater sense of ownership. Those preferences, along with actual service quality, can affect adoption even when the 33-month TCO comparison favours rental.

What does the finding mean for the rental market?

Rentomojo’s finding supports rental as a time-bound alternative for households furnishing a complete 2BHK and expecting occupancy of approximately 33 months or less. It does not establish that rental is cheaper for every household, because the calculation depends on the specified product bundle, a 16% EMI assumption, a 100% relocation assumption, maintenance costs and the treatment of refundable deposits.

The rental category remains small relative to furniture and appliance purchases, although Rentomojo reports growing use. Rental platforms displaced approximately Rs 2,080 crore of potential purchase-market revenue in CY2025, up from approximately Rs 720 crore in CY2021. Average rental penetration by volume reached approximately 1.0% for key furniture products and approximately 1.4% for appliances in CY2025, compared with approximately 0.6% and approximately 0.5%, respectively, in CY2021.

Awareness is a stated constraint. For every 100 people searching online to rent a house, approximately 15 searched for furniture or appliance rental in CY2025, although the share rose approximately 114% from CY2022. Rentomojo treats the remaining approximately 85 searches as potential headroom, which would depend on greater awareness, trust in product condition, and delivery, repair and relocation performance.

Conclusion

Rentomojo’s TCO analysis identifies a mismatch between a 33-month ownership break-even point and India’s 19-month average urban tenancy in CY2025. For a mobile household furnishing the specified 2BHK bundle, rental reduces initial cash outflow and incorporates servicing and relocation that a purchaser must otherwise arrange, but the result is conditional on the report’s assumptions.

The next measure to watch is whether adoption expands in the metro and Tier 1 cities that account for more than approximately 77% of Rentomojo’s stated total addressable market. The report projects the home furniture and appliances rental market to rise from approximately Rs 1,550 crore in CY2025 to approximately Rs 6,030 crore by CY2030P, a forecast dependent on urban mobility, subscription acceptance and providers’ ability to maintain the service economics used in the comparison.