Rent as a deposit on a house

holbol15

Can anyone tell me if they have heard of renting a property for a year and acting as a deposit to buy the house? If so can you give me more details about where i could find out more? Thanks

feisty1

Be very careful of such schemes, shoud you consider entering into anything ike this, pls ensure you choose yr own independent adviser & solicitor & don't commit to anything until all contracts have been checked out.......Stand by what I'm suggesting & don't be lured into using the other sides soicitor regardess of the discount yr offered

fishtastic

I think it would be fair to say when something looks too good to be true, mostly it is. If a developer could sell a house/flat then they would, if they have to use one of these schemes it's because they are having trouble selling.

In addition, you have to be very careful of the small print in this kind of agreement, what are you agreeing to? Price? Often, you are agreeing to the price it's at now, not in a years time. This is not always the case though.

Also, since house prices are dropping at a fair rate and will (hopefully) continue to for a while yet, you would probably save more on the price of the house/flat by waiting than you would get back in deposit of a years rent, subject to the above.

It's very common for people (especially parents) to wheel out the old renting is dead money. This is mostly true in a steeply rising market or during times when high inflation eats away at mortgage payments (relative to income). It's certainly not true at this moment in time.

Without knowing the exact nature of the deal, it's impossible to say what's best. Even if you're renting normally you should be trying to save for a deposit on top of you rent. If you can't pay rent and save up money then it's possible that buying a house might be a stretch too far at the moment as for most people rent is cheaper than the mortgage payments for the house they live in..... [In addition, mortgage payments can go up, if it's a flat then service charges, building insurance, furniture, white goods, breakdowns, servicing and loads more costs associated with owning over renting]

Fish

beingjdc

Everywhere I've seen it it's just been a scam - they pay your "rent" for a year instead of giving you a discount of the equivalent amount on the purchase.