Buy 3 years from now, at today’s prices? Er, no thanks.
These programs are in use in Chicago, Memphis and other down markets in the States and have been used in many a US down market before. How anyone can see an upside for the potential purchaser in a the current environment that’s predicted to be down for sometime is beyond me, you would be mad not to have an opt out clause inserted. Why is this being reported as a positive? Why are they giving exposure to this snake oil saklesman and has Rich Dad Poor Dad not got the developer into the deep shit he’s now in?
This is just preying on the ignorant and stupid.
He would fold this business up in the morning if house prices started to rise again. He’s essentially short selling houses to idiots who can not possibly win and taking advantage of all the shills in the media claiming that the housing market will recover (ie: start rising again) 'in the next year or two"
Rent for 3 years, yes that’s not a bad idea, but whatever you do, don’t do a deal on any property in Ireland in the current climate, when in two to three years, prices will almost certainly have fallen further by as much as 30 to 40 per cent. Have patients.
Are you advocating medicine as a career??
sorry, my spelling letting me down again.
Looks like a fairly cheap option to me as you have the right but not the obligation to buy
I think this guy probably deserves some credit. Basically, the option of renting with an option to purchase is available to any owner and occupier that so agree. This guy’s angle could be:
- Making the process easier by using standard formats.
- Creating awareness of this possibility on part of both owners and occupiers.
- Posssibly some negotiation but I’m unclear as to whose interests he’s acting in (possibly both).
If people choose to use his service rather than trying the approach direct then that is their choice.
Personally however I would be concerned about:
A) locking up my ability to deal in falling a market for that period of time insofar as my finances would be constrained by an obligation to pay rent. What ability is there to get out early and is there any risk of penalty payment on leaving the agreement early eg both to the owner and to the agent (who may be taking an ongoing commission).
B) Making sure that the purchase price is an option then it is just that. If so you can always renegotiate in 3 years time. Indeed, there may even be a possibility that you could negotiate before. However need to be sure:
- that it is not subject to some kind of arbitration which may not suit the purchaser.
- that it does not depend on notice procedures in which there could be risk of defaulting into an unfavourable position.
C) Making sure the up front payment was reflected in a discount on the rent payable.
D) The fairness of the rent and mechanisms for reviewing it eg are they asking for a fixed increase in what could be a falling rental market?
E) any VAT issues/ protection against changes in tax law. I know nothing of this but it’s a question I’d be asking.
F) The state of completion the owner is required to provide the property and it’s garden.
This does not pretend to be a complete list. But of course, nobody should be entering into this without legal advice; and irish solicitors will be pointing out all of these kind of risks- won’t they?!
PS- should this service be subject to some kind of regulation? Is this something the heralded property regulator should be getting their teeth into?
This would be a runner if he inserted the clause that ;-
Property may be purchased at the open market value applicable at the end of the rental period.
That would show hes up front but its unlikely to happen really, now is it?
The problem with this is that you’re “renting” for the rext three years in order to buy an option to buy at todays prices in 3 years time.
But are you paying market rents for the next 3 years?
If he convinces people to pay above the market rents then they aren’t really renting to buy, they’re renting AND buying an option.
If this guys mentors are Russ Whitney and Mr. Rich Dad Poor Dad, then run a mile, NOW. Run Run Run, don’t stop and look around, RUN.
I see a Joe Duffy special in this guys future.
The rent2buy.ie website currently lists 6 houses.
5 of them are holiday homes.
This is copied from The Anglo Celt newspaper published 22 October 2008. I can’t do links
What do you say? Certainly speaks of a willingness to ‘think outside the box’, but the box seems to be drawing them back in.
Sweet deal for this middleman. You can bet he is holding the desposit for those three years and getting the investment options or savings returns on it. Plus he is selling guarenteed rental rates for three years to landlords, claiming a percentage of that no doubt. And telling the vendor that s/he will see out the downturn and have a place on the market for the up swing. That option lets the vendor raise the price on an up swing or have a likely ‘get out of dodge free’ card on the continued downturn. Oh yeah, he is telling the vendor that only careful tenants will take this opportunity as they will treat the house like their own as it could be theirs one day and so the maintenance costs will be lower. And I bet he has signed himself into final sales commission. Nothing like a guy who can take your money for just for talking and make you feel good about it.
I was just watching ‘there will be blood’ and this is just like the middlemen that Daniel Day Lewis’ character was talking about in his sales pitch near the beginning. Class movie.
Oh I beg to differ there Mr Shortt. It is in the interest of the buyer that property prices fall or would you say that the buyers in your day loved inflated unrealistic prices Mr Shortt. Mr Shortt?
What the f**k has a rent-to-buy scheme in Cavan got to do with the Tyrone GAA Football Manager???
VIs in every broom cupboard. Come on Mickey, reveal your interests.
I’ll do it for him. The bould Mickey is an employee / director for the said EA, brought on board after Tyrone’s All Ireland success back in 2003, he is also a boxing promoter of sorts and I think he might manage Derry boxer Paul McCloskey. All this from being a teacher a few years ago ( he probably still is, although like many a TD not active ).
Well spotted. If you read that article you would assume that Mickey Harte has no connection with that EA whatsoever. It is a very clever piece of marketing written by that journalist! Who can argue with Mickey Harte?? The most successful GAA manager in the noughties!!