Real Estate - Real Estate Investment

The
rent back company can offer you the ability to buy back the property
when your situation improves. The rent
back and buy back option could be ideal if you are experiencing
short-term difficulties and do not want to lose your property.

The
rent back company will agree the price at which you can buy it back
at the beginning. The price agreed typically is fixed for two or
three years and then goes up by at about 5 per cent each year.

For
example, if the rent back company agree you can buy back the property
at 100k at the end of the initial two year period of renting the
property, then:

The
price we will sell it to you after 2 years is 100k

The
price we will sell it to you after 3 years is 105k

The
rent back company are committed to selling the property back to you
at the price agreed even if the property market appreciates more than
they expected. In the above example the property could be worth 110k+
at the time you buy it back at 100k.

At
the end of the rent back period, and when selling the property back
to you, the rent back company will arrange for the sale to cost you
much less capital than usually needed. For example, in the above
scenario, if they were selling the house at 100k back to you and the
house is genuinely worth more than 100k the company’s solicitors can
structure the sale in such a way where you end up paying us 100k but
get all your fees paid for as well as the stamp duty and part of your
deposit. Thus, you can acquire the property back from the company at
a much lower cost than usual