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Rent to Buy – What makes it a near perfect UK Lease Option Strategy?

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What is Rent to Buy?

‘Rent to buy’ or ‘Rent to own’ is a simple lease option agreement allowing a potential buyer to rent before they buy. Rent to buy is exciting investors in the UK. Well established in many English speaking countries including the USA and Australia, rent to buy offers those who would like to buy their own home a step up on the property ladder. It is a powerful strategy for the investor who wants to increase cashflow or feels ready to retire.

Rent to Buy – Other Often Used Names

Rent-to-Buy (when talking about buying a home) is also known as Rent to Own, lease-to-own and lease with option to buy. Cooperative options can also be used to set up a neat rent to buy scheme between a motivated seller and tenant buyer. Cooperative options, or assisted sales, are best used when someone else owns the property the investor wants to sell through rent to buy.

A lease purchase could also be termed rent to buy, but with an important difference – a lease purchase obligates the buyer to buy, whereas a lease option with rent to buy does not.

How Rent to Buy Works – Rent to Buy Schemes

In a rent to buy scheme the lease option contract gives the potential buyer a legal right. The buyer (often a tenant buyer) has the freedom or right to buy the lease optioned property at an agreed price within a certain time period. In order to keep this legal right, the buyer must make monthly payments to the seller and care for the property as if it were their own. This is broadly how rent to buy schemes work in the UK.

Rent to Buy – A Perfect Strategy for Property Investors?

Rent to buy or rent to own can be used to sell your property to a potential home owner or another investor. A rent to buy agreement can be set directly between the owner and tenant buyer, for a fee, using a cooperative option.

Cooperative options are powerful because they allow investors to generate cash quickly, even in a very challenging housing market. If cooperative options interest you consider our cooperative options courses, training and education. Our home-study course. called “Using Cooperative Options for Fast Profit (and to help sellers and buyers move on)” may be just what’s needed to get rent to buy working.

Tenants buying with a rent to buy scheme are willing to pay more.

Tenant buyers are willing to pay more because they benefit from rent to buy and the lease option agreement. Consider the following:

  • The purchase price is fixed by the lease option and won’t change over the term.
  • The tenant-buyer has the choice to buy or not to buy and can decide when is the best time for that.
  • The tenant buyer can treat the house as home from day one.
  • Move in is usually much quicker than in a conventional house sale.

How does rent to buy benefit the investor?

There are many important reasons for the UK investor to consider rent to buy. The benefits of using lease options with rent to buy are huge.

  • Tenant buyers will typically pay a deposit when they move in – usually 2 – 5% of the agreed purchase price.
  • The tenant buyer is

    willing to pay the owner above market rent.

  • Tenant-buyers are often willing to pay more than the property is currently worth because the investor or owner is giving flexible buying terms.
  • The tenant is motivated to care for the property, which is viewed as a home rather than simply a place to live, which results in lower maintenance costs.
  • There are fewer void periods with a rent to buy home or property.
  • If the tenant buyer defaults on the lease option agreement, the owner can keep the money paid up front and the extra payments made during the term, as long as that is made clear in the option agreement.

Perhaps we can help

At Lease Options Made Simple we are often offered individual property and portfolios by investors who want to move on. If selling your property to us through a lease option, or want help with using a rent to buy scheme in the UK seems attractive, please feel free to contact us.

Using rent to buy is rewarding

Helping tenant-buyers (often first-time buyers) with rent to buy is rewarding. Why? Tthe financial benefits of rent to own are impressive. Rent to buy gives the busy investor more time. Cooperative options gives the investor fast cash and the satisfaction of helping others move on. Tenants who are interested in buying through rent to own or rent to buy are more disciplined, motivated and less demanding when it comes to maintenance issues.

Rent to buy and housing market conditions

Rent to buy as a strategy works in any housing market conditions. Rent to own helps motivated buyers, and motivated buyers are always around. Rent to buy allows first time buyers to move in, settle down and start enjoying their own home without a mortgage. If the tenant buyer is unable to secure a mortgage in view of strict lender requirements, you can give them time until the best time for them to stop renting and buy.

If you are interested in rent to buy and rent to buy strategies in the UK we can help. We can also help you find and work with the right tenant buyers. Why not sign up for regular updates from our blog, and if you are really serious about using lease options to build wealth why not consider investing in our Lease Options Made Simple Home Study Course?

You could sell property you already own using rent to buy

If you are tired of property or never really wanted to be a landlord or landlady, rent to buy could be perfect for you. Why not consider contacting us at Lease Options Made Simple and we will be pleased to help.

Talk to us about your lease option goals and we’ll share our strategies

If you are looking for success in using rent to buy schemes or lease options in the UK and want to use lease option strategies to profit from property, please let us know. We are always keen to hear about the goals and the success of our students who benefit from our lease options training and education. We will be pleased to help you too. As far as property options go, there is one you just wouldn’t want to miss – Rent to Buy .

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