19:18 PM, 4th April 2011, About 10 years ago
Housing minister Grant Shapps has publically backed a web site advertising rent-to-buy homes.
The scheme seems to promote lease option purchases that are popular in the US and Australia but rarely seen in the UK.
The web site – www.tryitbuyitproperty.com – matches homeowners who have problems selling with potential buyers who cannot raise a mortgage.
Shapps has aligned the Communities and Local Government Department with lease options for the first time by expressing the department’s support for private sector solutions that help home seekers.
His tacit approval of the tryitbuyitproperty.com scheme was included in a response to David Morris MP (Morecambe and Lunesdale) – the local MP for where the web site is based.
“This is a popular concept with motorists and has triggered a solution to get the struggling housing market moving,” said site owner David Riley.
“It also works particularly well for overseas property purchasers, as the opportunity to live in a new country on a trial basis is the best route to a sound investment.
“Just like purchasing a car through a personal lease purchase plan, you can choose to walk away from the property at the end of the contract.”
Lease options are a legal but unpopular method of buying a home in the UK.
A lease option generally works by a renter agreeing to buy a home at a guaranteed price on or before a set date – often years ahead. If they buy the home, often the rent goes towards the purchase costs, but if they cannot raise a mortgage or complete the deal, the rent is lost.
Many housing associations run a Rent to Homebuy scheme with government approval that gives buyers the chance to rent a home at a reduced rate while they save for a deposit to purchase a property.
Some homebuilders are also experimenting with lease options sales.
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