Rent to buy.

katygeorge

hello. Im looking at doing a rent to buy. But i really havnt a clue what im doing. I understand the basics - pay rent - save deposit - buy home at end of term.

But is there more to it?
what questions should i be asking? It feels odd as im committing to a house that i wont have a survey or reports done on.
i feel like im jumping into something without much of a clue what im doing.

Any advise will be massively appreciated or if you can point me in the right direction of some stuff to read

_Penny_Dreadful

https://forums.moneysavingexpert.com/discussion/6664795/rent-to-buy

Is this the government’s Rent to Buy scheme in England (excluding London)?

If buying with a mortgage at the end of the 2 year period you’d need to have at least a Home Buyer survey carried out. Getting to live in the property for at least 2 years is a luxury other home buyers don’t get. It’s only once you’re living in it that you get to experience a property’s quirks and the noise from neighbouring properties.

https://www.gov.uk/rent-to-buy

katygeorge

yes its in the UK.
guess it just all seams so simple that i feel i must be missing something

FreeBear

Be careful. Whilst the government scheme is regulated, private schemes do not have the same level of protection.

katygeorge

https://forums.moneysavingexpert.com/discussion/comment/81969659#Comment_81969659

Thankyou.
how can i find out if its a government scheme?
its a housing association building the entire development. Onward living they are called.

FreeBear

https://forums.moneysavingexpert.com/discussion/comment/81969694#Comment_81969694

It would appear to be a government backed scheme. You would need to ask (preferably in writing) to confirm.

I'd also ask if the selling price at the end of the term is today's value or based on the market value at the end of term. Current value would include the new build premium, whilst market vale at end of term could be considerably higher. Or if you are really lucky, the market implodes and house values fall (highly unlikely).

_Penny_Dreadful

https://forums.moneysavingexpert.com/discussion/comment/81969225#Comment_81969225

Saying, “it’s the UK,” doesn’t help. I linked to the scheme that’s specific to England ex. London, London has a scheme called London Living Rent, Wales and Northern Ireland each have their own rent to buy schemes, and a government backed rent to buy scheme isn’t available in Scotland.

If I assume you’re in England ex. London then to be eligible for rent to buy you must be:

• in full or part time employment
• a first-time buyer
• able to pay your rent and save for a deposit at the same time

You may also be eligible for Rent to Buy if you are returning to home ownership following a relationship breakdown.

saajan_12

https://forums.moneysavingexpert.com/discussion/6664795/rent-to-buy

what questions should i be asking? It feels odd as im committing to a house that i wont have a survey or reports done on

Read the contract for the below or ask about:

• are you obligated to buy or is there a cost if you walk away?
• how is the house purchase price determined?
• how can the rent change during the rental time?

Also compare the rental cost to a normal property on the open market - are you paying more than you would elsewhere?

That'll tell you the risks with going ahead with the rental. If you go ahead, you'll see a lot of the issues just by living there, eg neighbours, damp, leaks, etc. However before the purchase you can also get a survey done (will be required if buying with a mortgage).

katygeorge

https://forums.moneysavingexpert.com/discussion/comment/81972240#Comment_81972240

thankyou those are some good points to look into.

i have asked about the obligation to buy and no im not i can also come out at the 12 month intervals. They can also evict me if i give them cause but i dont plan on doing
i do have to prove i am saving at a annual meeting but as i fully intend to and more than they are requesting im not worried about that one.

yes the rent is cheeper by £300-£400 locally.

silvercar

https://forums.moneysavingexpert.com/discussion/comment/81972498#Comment_81972498

check what rental contract you have. Particularly with the rental rights act coming into force, you could be on a winner with reduced rent and the act giving you more rights to stay in the property.