Rain barrels, otherwise known as water tanks here in Australia, are very common.
Some councils have made it compulsory that all new developments have water tanks as part of the build.
Rain is collected directly off the roof, which here is usually corrugated iron and safe.
Many years ago most tanks were also corrugated iron, but polyethelene is now the most common.
Mostly it is used to garden and piped to grey waste (toilets etc), and helps reduce water bills, and preserves water supplies in our often drought ridden regions. During bad droughts, it is common to be put onto water restrictions in whole cities/councils for months at a time. Washing cars becomes a big no-no, as does watering lawns, unless it is coming from a tank.
It is mandatory for them to have screens on the top, as mosquito's are a big problem if left open, and it's usually advised that the water isn't used for drinking.
Very effective when used in the right regions and climates.
Murdoch