rent2buy

showmetheway

Is the rent2buy scheme a scam or actually a good thing for firtstime buyers?

Treehouse72

Depressingly, if one were to go purely on the evidence of the way just about everything in this country works, any reasonable person would have to conclude prima facie that the scheme is probably an exceptionally bad idea, badly implemented, is probably cripplingly expensive and will almost certainly have the exact opposite long term effect of whatever it nominally claims it'll do.

GerardKeating

showmetheway wrote: »

Is the rent2buy scheme a scam or actually a good thing for firtstime buyers?

It would be a good idea in a market where prices are stable or rising, but in an era where prices are collapsing, it make no sense to agreed to purchase a property at a price set several years previously.

murphym7

showmetheway wrote: »

Is the rent2buy scheme a scam or actually a good thing for firtstime buyers?

This has already been discussed many times - use the search function:

http://www.boards.ie/vbulletin/showthread.php?t=2055993888&highlight=rent2buy

http://www.boards.ie/vbulletin/showthread.php?t=2055481503&highlight=rent2buy

http://www.boards.ie/vbulletin/showthread.php?t=2055449308&highlight=rent2buy

As with everything on the accomadation forum you will have two clear points of view - people who think its a good idea and people who think its crazy. There are pro's and cons - remember that not all the schemes are run by dodgy developers trying to offload houses in ghost estates, a lot are, not all.


Biggest thing that sold me was this fact. Lets say I had enough for a deposit for this house last year and bought it (we are not here to discuss the merits of buying in this market by the way) So I have bought this house and the value over the 3 year term has dropped by 100k. I am now in negative equity living in a house I can not sell.

Now look at my example in my current rent to buy contract. I reach the end of the contract period and the house has dropped by 100k - I do not have to buy this house, I can walk away less the 36k I have paid in rent and I have just saved myself the pain of a 64k drop in value. Or, I can make a smaller offer on the house at the value the valuation agent sets, if the vendor does not agree then I can just move on to purchase another property - at this point my purchasing power is far greater than it was 3 years ago - I may have walked away from the portion of the 36k I paid on rent (although I would have been paying rent somewhere anyway) I will have 3 years of other savings which is a sizeable chunk of a deposit when house prices are very low, this other savings was to reduce the principle of the R2B house but it makes for a very good plan B.

So in short, its not a scam (illegal) It is a very simple process with robust contracts signed for in your solicitors office.

the_syco

murphym7 wrote: »

Now look at my example in my current rent to buy contract. I reach the end of the contract period and the house has dropped by 100k - I do not have to buy this house, I can walk away less the 36k I have paid in rent and I have just saved myself the pain of a 64k drop in value.

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So in short, its not a scam (illegal) It is a very simple process with robust contracts signed for in your solicitors office.

Although more of these rent2buy schemes do seem to be popping up, please be aware of some of the older ones, where bidding at a lower option wasn't there.