Grant Shapps supports rent-to-buy scheme
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A new rent-to-buy property website has met with the approval of housing minister Grant Shapps.
In response to the launch of tryitbuyitproperty.com, Shapps expressed his department’s support for private sector solutions that address current challenges in the housing market.
The website is the brainchild of property entrepreneur David Riley and is aimed at homeowners who are unable to sell their house as well as purchasers unable to obtain a mortgage.
It matches potential renters and future buyers across the UK, claiming rent to buy is a solution that bridges the gap between renting and homeownership.
Monthly rental payments and the option to purchase price are agreed up front by the two parties, and a proportion of the rent can be used to offset the final purchase price.
Riley likens the initiative to the way cars are purchased using a lease plan.
He says: “Now this popular concept with motorists has triggered a niche opportunity and a solution to get the struggling housing market moving.
“It also works particularly well for overseas property purchasers, as the opportunity to live in a new country on a trial basis is the best route to a sound investment.
“And just like purchasing a car through a personal lease purchase plan, you can choose to walk away from the property at the end of the contract.”
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Readers' comments (6)
Anonymous | 4 Apr 2011 3:45 pm
Can see why it would suit a renter but why on earth would someone wanting to sell their property want to do that?
Lodgers in the UK are mostly messy slobs. They would deteriorate the property then try to buy it cheaper after they've ruined it.
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gmac | 4 Aug 2011 4:53 pm
What an uninformed, ignorant, arrogant and frankly rubbish comment. The sale price is agreed when you move in, not when the time comes to buy. You clearly know absolutely nothing about this scheme. And branding lodgers as *mostly messy slobs* further highlights your general contempt and your extreme level of ignorance. On what statistics are you basing your **critique**? Literally hundreds of millions of people rent homes in the uk. How many of therir homes have you been in?
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Kasim Muflahi | 12 Aug 2011 5:52 pm
gmac is essentially right but 1 of his facts is wrong. The population of the UK is only 60 million, so 100s of millions of renters is way out.
The point is that the price is fixed when the tenant buyer moves in, as gmac said, but Anonymous is also right in that the tenant can trash the place and opt not to buy the property at the end of the term.
In this type of contract the obligation is on the seller to the tenant buyer who is not obligated to buy.
However, to protect themselves, the seller would add clauses in the contract that the buyer would be responsible for the upkeep of the property and, if the buyer chooses not to buy, they must return it in the same state they found it in/ Otherwise, the seller can sue the buyer for damages.
The problem is that if the buyer convinces the court that they have no assets, although the seller would win the case, they won't get much money for it.
A better way is to legally transfer the mortgages with the property. See here: http://www.gumtree.com/p/business-services/transferring-a-mortgage/85796539
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Danny | 28 Sep 2011 10:45 am
To follow the anon comment, I have a number of houses that I rent out. You are indeed correct that no one will look after a property like you would do if it was your own, hence, the renting industy is littered with the horror stories with what you maybe aware.
However, when someone is purchasing a property you will find a completely different person that will reside in your property. These people (who are both renting and buying at the same time) will not only have paid out a deposit which will be far greater than a bond they will also be paying a higher contribution to their rent to cover the purchase option. In short, if a person has more to lose the more they will respect the situation they are in.
The longer they are in the property the more they have to lose. There is also the added fact that there is the natural increase in the property value, therefore anons point at issue will not represent a real problem.
I hope this helps
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Philip Allen | 15 Dec 2011 1:16 pm
Why is it that the uninformed are always those that use the most common gutter language. No wonder you wanted to stay anonymous. I would too if I were that stupid. A tenant buyer is paying for their property from day one. If they 'trash' the place they are simply trashing their own place. If they choose to walk away they do so leaving behind all the money they have put into the property. Just the dumb sort of thing that 'anonymous' would do! Incidentally, I AM a tenant buyer and it really is the absolutely best way of buying a property.
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lizzie | 12 Jan 2012 10:45 am
what an awful thing to say, im a tenant and so is my younger sister. me n my partner is amased by this scheme i think its a wonderful idea espeshaly for people that cant get morgages straight away and dont have alot of savings
this is a really good idea n i cant wait until my tenancy is up so i can get on the scheme with my parner
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