Vincent Wong is one of Europe and Asia’s leading authorities on Rent to Buy deals (also known as Lease Options) within the property sector and has helped thousands of people all over the world to secure their property purchase by using such deals.
For those without knowledge of this entirely legal and relevant property purchase solution, in most simple terms, ‘Rent to Buy’ is a private property agreement laid out between vendor and purchaser. The purchaser agrees an option price with the vendor (i.e. a purchase price ‘to buy in the future’) and the purchaser pays rent each month with a view to buying the property in the future.
The new legislation introduced by the Tory government is applicable to professionals with a maximum income of £33,000 (for individuals) or £66,000 (for couples) and grants a 20% BMV (Below Market Value) rental rate, guaranteed for seven years. This deal will apply to new build properties only.
And whilst research suggests that many first time buyers would need 22 years’ worth of savings to get onto the property ladder (without the Bank of Mum and Dad) the government believes this will help the British housing crisis.
Commenting on this new policy, Vincent Wong, Co-Founder of Wealth Dragons and international Rent to Buy expert, said:-
“In theory, this new government policy will help some young people get on the property ladder. However, Rent to Buy agreements are perfectly legal and feasible for anyone wishing to assume ownership of a property, regardless of their age or social standing.
“Alongside introducing the new policy, the government should be educating the public at large about the benefits of using a Rent to Buy contract to secure any property purchase. In the past, there has been a great deal of misunderstanding and hesitation about using this kind of deal, even amongst property professionals who are not familiar with structuring such deals. In the USA, Rent to Buy deals are used widely for residential property purchases.
“Even if the government is building new homes for young professionals, it will always struggle to create enough supply to meet demand. New build properties only account for approximately 10 per cent of the total British housing stock. Encouraging Rent to Buy as a method of securing property to any vendor and purchaser, could help stimulate the housing market across the board.
Vincent Wong offers the following tips for First Time Buyers seeking solutions to their housing purchase challenges, regardless of whether they meet government criteria or not:-
1.Define an area in which you want/need to live
2.Educate yourself. Do research via websites and through local ‘For Sale’ signs/Agents
3.Put an ad on a local forum or newspaper ‘FTB seeks local property – please call’
4.Meet with homeowners and find out why they are selling – ask if a Rent to Buy/Lease Option contract might be viable
5.Find a lawyer that understands the Rent to Buy/Lease Option process
Rent to Buy/Lease Options is a legal and viable way to buy or sell the rights to a UK property. As with any property purchase or sale, always seek the correct legal and financial advice.
For more information on Wealth Dragons and how they can help you with your Rent to Buy (Lease Option) transaction please visit www.wealthdragons.co.uk – Like us on Facebook or follow us on Twitter!
