A novel rent-to-buy home purchase scheme has been set up to help renters become homeowners.
HomeNow aims to get people on the property ladder by buying a home and then renting it to them at a fixed price for a five-year period. Residents receive one third of the increase in value during their tenure, to use as a contribution towards the mortgage deposit when they buy it.
The business currently has properties across Kent, Surrey, Essex and the Midlands worth between £150,000 and £400,000.
Residents source the property and then approach HomeNow; once it’s been approved, the firm negotiates with the vendor, pays the stamp duty, legal and conveyancing fees, and then becomes the landlord.
HomeNow complies with all landlord obligations such as gas safety and electrical checks.
Co-founder Jonathan Potter (main picture) explains the idea is that residents should feel like homeowners because they are earning equity and will hopefully own the property themselves.
They still receive the equity if they decide not to buy. By locking them into an initial five-year period, it also removes the stress of spending a disproportionate amount on rent, without having adequate funds for a mortgage.
"As renting tenants – on a fixed rent – they only have to provide a standard tenancy security deposit of four weeks’ rent.
“We are very keen that from the beginning residents should treat the properties as if they are the owners, that includes decorating and home improvements,” he adds.
“HomeNow conducts annual inspections to ensure the property is being well maintained but other than that, the residents have full autonomy.”