mandelbrot
Registered User
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- 2,330
Hi all,
As someone who is hoping to become a FTB in the next couple of years, I'm intrigued as to why there is not much more activity on a rent to buy basis?
I remember there was a flurry of talk about it 2/3 years ago, but then it never really seemed to take off, and I'm wondering why not? Surely from the vendors point of view, particularly a developer, the cash flow is desperately needed, rather than have a house sitting there depreciating in value and not generating any money.
And from a buyer's perspective, in a market where obtaining credit is so difficult, the possibility of building up a deposit out of rents, and agreeing the purchase price, has to have an advantage.
From my point of view as a prospective buyer, if I see a house in a good location that I know I'll want for the medium- to long-term, then it doesn't make a huge amount of difference to me if the market falls by another 10%-20% over the next couple of years, because this will be offset by
1. The portion of the rent being rolled up into my deposit
2. The value to me of actually having possession of the house during the period, and
3. My retaining the ability to walk away at the end of the rental period if I choose to, if I end up not liking the house / area, or there is better value elsewhere.
So I'm just wondering about others' take on the idea of rent to buy...? Anyone got any experiences they can share, from either side?
As someone who is hoping to become a FTB in the next couple of years, I'm intrigued as to why there is not much more activity on a rent to buy basis?
I remember there was a flurry of talk about it 2/3 years ago, but then it never really seemed to take off, and I'm wondering why not? Surely from the vendors point of view, particularly a developer, the cash flow is desperately needed, rather than have a house sitting there depreciating in value and not generating any money.
And from a buyer's perspective, in a market where obtaining credit is so difficult, the possibility of building up a deposit out of rents, and agreeing the purchase price, has to have an advantage.
From my point of view as a prospective buyer, if I see a house in a good location that I know I'll want for the medium- to long-term, then it doesn't make a huge amount of difference to me if the market falls by another 10%-20% over the next couple of years, because this will be offset by
1. The portion of the rent being rolled up into my deposit
2. The value to me of actually having possession of the house during the period, and
3. My retaining the ability to walk away at the end of the rental period if I choose to, if I end up not liking the house / area, or there is better value elsewhere.
So I'm just wondering about others' take on the idea of rent to buy...? Anyone got any experiences they can share, from either side?