Divvy Homes Says Rent-to-Own Deals Work. Next Year Will Be a Test.

And the economic destruction of the pandemic is driving demand up, she said.

“I thought it would be the end of the world,” said Ms. Hefets, 33, who expected housing prices to drop and mass foreclosures that haven’t materialized. “Right now, we are doing more volume than we’ve ever done. It’s been crazy.”

Ms. Hefets, who is also Divvy’s chief executive, said the company is essentially a “savings mechanism” for its clients. They pay above-market rent, with the premium going toward maintenance costs and an eventual down payment. If the renter does buy the property, Divvy pockets a profit on the sale on top of the rent it collected. If the renter decides not to buy — or still can’t qualify for a mortgage — Divvy returns the extra cash the renter paid toward equity, minus a “surrender fee” of 2 percent of the original purchase price.

For renters like Janese Scott, the higher payments are motivation. Ms. Scott, 27, bought for her house in Lithonia, Ga., for $133,000 in June, just five months after she started making monthly rent payments. Those payments were $1,520: $1,220 for rent and maintenance, and $300 toward equity.

“Financially, it doesn’t make that much sense to be paying so much,” said Ms. Scott, a Verizon sales executive with a 6-year-old daughter. Her new monthly payment — a mortgage at 2.75 percent, plus costs for insurance — is only $895.

But Divvy hasn’t always lived up to the expectations of renters, and at least one local official, even though it charges clients extra for upkeep.

Divvy allowed a renter to move into one Ohio home without first correcting a half-dozen property code violations, said Sally Martin, South Euclid’s housing director. Problems with wiring in the basement and drainage and ventilation in a bathroom have taken a year to sort out, she said. A final inspection is scheduled for next month.

“Divvy, by their own admission, did not do well on this transaction and is behind the eight ball when it comes to getting this up to code,” Ms. Martin said in an email. She said Divvy’s decision to buy a house in need of substantial work appeared to be at odds with the company’s business model — which “only works if the house is in good condition.”