Rent to HomeBuy
Rent to HomeBuy was always dependent on the supply of certain properties that came under the scheme, and most of these houses have been sold off. It may still be possible to find this scheme around, but it is unlikely and there are more up to date and available schemes to consider instead.
What was it
Rent to HomeBuy is an option that allows newly built homes to be rented for a set period of time within the agreement that the habitant will then purchase a percentage of the property when the rental period ends.
How it worked
Homes with this option available are provided through a number of housing associations on the basis of assured short hold tenancies, combined with reduced monthly rental charges of around 80 percent of those found on the open market rents.
This rent is paid for a limited and pre-decided period of time, at the end of which there are expectations that the tenant will purchase the house under the terms of a New Build HomeBuy scheme.
This option provides an opportunity for first time buyers to get onto the property ladder despite the fact they do not initially have the funds for a deposit, therefore the rental period provides the time to save money for the deposit, allowing the purchase of amortgage. The New Build HomeBuy scheme then allows the occupant to part own part rent the property as they save up enough money to gradually purchase more and moreshares of the property from the housing association.
It is often the case that different housing associations’ Rent to HomeBuy schemes vary in different ways, for example some might have a ‘Rent Save Buy’ option or a ‘Try Before You Buy.’ Therefore, their terms and practices may differ, in order to find what is available it is advisable to contact the relevant housing association directly in order to clarify their specific requisites.
Options after buying through Rent to HomeBuy
Throughout the tenancy there will be an opportunity to buy a share in the property. Once the end of the rental period is reached, the customer will be assessed to decide on their eligibility to buy shares in the property as well as deciding what they can realistically afford.
If at the end of the pre-decided tenancy agreement the customer is not in a financial position to buy the property, there may be an opportunity to renew the tenancy, however this is not by any means guaranteed due to the nature of the agreement.