A lot of our clients have come from the rent drain where they have been outlaying their hard earned money for years and getting nothing in return other than accommodation.
We know that you probably understand this and really want to opt out of the rent drain and stop paying someone else's mortgage. But there is something stopping you. Lots of people want to buy their own home but are not able to jump into the property market for numerous reasons…
We are specialists who can help you secure your own home through Rent2Buy. Imagine arriving home to a house that is your own. The feelings of security and accomplishment knowing that you now have something that is growing in value. To top it all off, if you want to paint that fence or put in some landscaping and beautification then you can. It is yours!
A Rent to Buy, also known as a Lease Option, allows you to step onto the property ladder today.Why would a Rent to Buy be the right choice for you?
The Benefits of a Rent to buy property:
A Rent to Buy allows you to choose the home you want to own NOW. The number of years you will Rent to Buy in this home will differ for everyone but is typically between 3 and 5. During this time you are working towards a deposit within the home of 15-20% to be able to obtain a loan from the bank at the end of your term to purchase the house.This deposit within the home is accumulated over the term of your Rent to Buy in three ways.
Every person and their situation are unique and the terms of each Rent to Buy are never the same. There is some flexibility in creating a Rent to Buy to suit you.What do I need to be a Rent to Buy tenant?
The table below gives you an indication of what deposit and weekly rent is required for a particular value home.
(portion of rent
For this example we will use a couple who are able to make weekly payments of $575. They have a deposit saved of $10000 and can start looking for a property on the market around $300,000.
Once they have found a home we work directly with the vendor or agent to get the home under contract. We then find the Investor to take over the Rent to Buy.
We will facilitate all the details of the contract between this couple and the investor. It has been agreed that the Rent to Buy will be for 5 years and the end purchase price for the couple will be $348,000 less accumulated Rent Credits and the deposit initially paid.
From the weekly rent of $575 it is agreed that $115 of this is a Rent Credit. At the end of the 5 years they have built up $29,900 (115 x 52 x 5) along with the $10,000 deposit which is taken off the end purchase price. They only have to pay $308,100 as they have accrued a total of $39,900 that is deducted from the purchase price.
As for the bank, if you calculate now what the value of this home will be worth after the 5 years using the 5% growth rate it comes in at $383,000. This will please the bank as you are only asking to borrow $308,000 effectively providing a deposit of $75,000, or 20%.
|End purchase price to you||$348,000|
|Less rent credit of $100 per week for 5 years||-$29,900|
|Less initial deposit||-$10,000|
|Total balance to pay||$308,100|
|For the Bank:
Assumed market value (5% compounded for 5 years)
|Equity within the home (deposit)||$75,000|
Wanganui: Kawatiri, Wanganui
Parking/Garaging:1 Car Garage
Amenities:Close to hospital.