Rent to buy

mickeypat

anyone on here know much about this,is it a good/bad idea,is it a scam by the developers,im goin renting a house in limerick after xmas but might try this instead as it seems your rent would go towards the price of the house,i dont want to buy yet as i think house will be comming down for another few years yet,any views anyone doing this already?

Nadaur

mickeypat wrote: »

anyone on here know much about this,is it a good/bad idea,is it a scam by the developers,im goin renting a house in limerick after xmas but might try this instead as it seems your rent would go towards the price of the house,i dont want to buy yet as i think house will be comming down for another few years yet,any views anyone doing this already?

afaik you agree to buy at a price before 'renting'....its not like normal renting.....basically it just makes it cheaper to get in the door as regards deposits etc.....I may well be entirely wrong

mickeypat

would you have to buy after 3 yrs or not?

johndaman66

mickeypat wrote: »

would you have to buy after 3 yrs or not?

From what I have being told the way it works is that you are not committed to buying the property. Buying would simply be an option after 3 years in your case for example and you would also have the option of walking away. The price you would pay in 3 years time is determined now. It may (may not) be a good price now from your point of view but most likely a high price in three years time based on the current trend. Not necessairly all of the rent you pay goes towards the purchase price either. Thats the way I've being told it works but am sure there may be other variations of rent to buy schemes out there.

the_syco

johndaman66 wrote: »

The price you would pay in 3 years time is determined now. It may (may not) be a good price now from your point of view but most likely a high price in three years time based on the current trend.

One way to look at is that it wasn't really around during the boom time, and only is popping up with the market going down, so as it looks to only benefit those trying to shift the houses at the current price as opposed to the price in 3 years time, it doesn't seem to be a good deal. Some will say that you get to build up a deposit which is fair enough, but you go for a house that is 300,000 with a deposit of 30,000 that you make by paying 833 a month, in 3 years time the house next to you may be going for 200,000.

The trend as such, is that house prices are falling, and thus buying a place in any way at the moment is not really a good idea.

In saying that, if you're buying a house in a decent location which has a stuff nearby, a community in place and you're looking to stay there the rest of your life, it may not be a bad deal. For an apartment, I wouldn't touch it.

Senna

It started off as a pure scam, but most builders are in so much trouble that it could work out for some people, as long as;
1. The rent you pay is similar or no more than 10% more than you would pay for renting a similar house.
2. The purchase price isn't set now, its decided in 2/3 years time. At that time you can decide to buy or just walk away.

Some schemes do offer both of these.
There's a good few threads already on this topic.

mickeypat

im not interested in buying now as i think houses will keep comming down,id have a good deposit {20%} for a house at the minute,if the price wasnt set until three years time that wouldnt be too bad as im going to have to rent anyway but if it was goin towards the house id be happier rather than into some landlords pocket,thanks for the help though,anyone in limerick joined any of these schemes?

the_syco

mickeypat wrote: »

but if it was goin towards the house id be happier rather than into some landlords pocket

Although it may be gain towards the house, it would go go into the builders pocket, and they could hold you at the higher cost, leaving you with many extra years to pay off.

kiersm

AFAIK its done through the local council so you will need to contact them b4 you do anything, it used to only be done in certain area, and certain estates. Your best bet would be contact Limerick Council. Do you know what area you would be interested in

If you look up Limerick City Council website (www.limerickcity.ie) and its called Affordable Housing. I can't remember the details but we looked at it before we bought our house but it didn't suit what we wanted so we didnt bother with it. Hope this helps