Monday, April 4, 2011

Grant Shapps supports scheme aimed at getting more suckers onto the Ponzi scheme

Grant Shapps supports rent-to-buy scheme

Shapps expressed his department’s support for private sector solutions that address current challenges in the housing market. The website is the brainchild of property entrepreneur David Riley and is aimed at homeowners who are unable to sell their house as well as purchasers unable to obtain a mortgage. .It matches potential renters and future buyers across the UK, claiming rent to buy is a solution that bridges the gap between renting and homeownership. Monthly rental payments and the option to purchase price are agreed up front by the two parties, and a proportion of the rent can be used to offset the final purchase price.

Posted by mark wadsworth @ 03:27 PM (1381 views)
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3 thoughts on “Grant Shapps supports scheme aimed at getting more suckers onto the Ponzi scheme

  • sibley's b'stard child says:

    But surely the lender would take a dim view of the mortgage holder effectively becoming a landlord?

    Besides which, the usual f*ckwittery dodging the obvious as endorsed by the punchable one.

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  • I like the first comment below:

    “Can see why it would suit a renter but why on earth would someone wanting to sell their property want to do that?”

    Indeed, how does this benefit the seller? If the seller has a mortgage, then they need to sell up fully to be able to buy their next property. If the seller is a landlord, they would have little interest in selling.

    The most likely scenario is that the seller is a housebuilder. However surely even they need to free up capital quickly to be able to build more houses? It’s also a lose-lose for housebuilders. If property prices fall, the tenant just walks away. If property prices rise, the housebuilder gets less than it would be worth on the open market.

    The analogy with car leasing is false. Firstly, lease plans are mainly a tax dodge for corporate cars; it’s not a popular choice for individual buyers. Secondly, they are poor value if you actually intend to keep the car after three years (whereas if you don’t want to keep the car, it means you get a new model every three years with little hassle). Thirdly and most obviously, cars plummet in value. Depending on the model, after the first three years it will be between 70% and 40% of the new purchase value.

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  • Rent-to-buy is just another pointer to that which is overpriced whichever way it is purchased.. Sharpp practice indeed.

    Is good cop beginning to show his true colours. He is on a salary.

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