Innovative move from Cork property developer
I sat next to the developer of the Cork scheme CastleLake Tadhg O Brien on my flight home yesterday, He has just launched an innovative new scheme with this development and I wanted to ask him how it had gone.
He told me it is flying, deals are being signed every day, I think its an excellent idea and I positive that you will see a lot more of it in a depressed Irish property market over the next few months.
The easy way to owning your dream home
Having difficulty paying rent and saving for your deposit?
Tired of paying dead money on a house you will never own?
Our rent-to-buy scheme is simple, straight forward and has no catches
* Select the property you want to own – the price is fixed for three years
* Sign a standard rental agreement.
* Move into your new home.
* At end of year three you decide if you want to buy.
* If you buy, all rent paid is deducted from the agreed price.
* If you decide not to buy you simply vacate premises.
Example
Select three bed town house
Purchase price fixed now at €279,000
Monthly rent €1,100.
At end of year 3 you decide to buy
New sale price – €279,000 less 36 months rent = €239,400
Thats a brilliant and very affordable idea. Wonder how long it will be before the folks in Dublin start ripping off the idea
man thats genius,
especially considering the gov just put the brakes on affordable housing yesterday
It’s a scam designed to bail the developers out of having to pay the mortgage on un-sold property and to keep prices and rents artificially high. What goes up must come down, and this is going to be a big implosion. For some interesting statistics check the website below.
http://daftwatch.atspace.com/
I think it’s another option and it gives choice . But I like the sound of it.
Great Idea, two words of caution:
1. If the house is valued at 279K now (by the developer!!!) and you get it next year for 269K (if you buy then!!). How will you get a mortgage if the bank then value it say at 250K??????????
** To overcome this I recommend you get a valuation now privately to help minimise your risk**
2. At present the rent-to-buy scheme is new and attractive… is there a reason this developer is doing it now/first? (i.e poor quality homes!!!) Will more developers follow in suit, maybe closer to the city or with lower cost’s?????
Could you re-do the calculations if the price of the property on the open market decreases by circa 5-10% / annum? i.e. 300k apt, 5-10% = 15- 30k/annum, = 50-100k/ over three years. So over the third year you r 300k apt is not 200k-250k. So the developer gets the risky part of his portfolio “covered for 3 dodgy years”. Its a brilliant strategy for the developer.
@Derek
I would definitely not say poor quality homes, I have been in them and have driven around the estate, very high quality IMO
I think it’s a great idea. Means the developer is willing to stand over his work. God knows the developer who owns the house im living in wouldnt do the same! Took him 3 weeks to remove five LIVE bare wires which he wasn’t going to finnish because they don’t put “those fixures in for the rented houses!”, still waiting on him to actually finnish the last little bits and pieces of the house.
It’s a classic risk reversal from a guy who obviously thinks his houses are a quality product. Remember that once you’ve lived in a house three years you’ll be attached to the nieghbourhood etc and unless the house is really shody you are far more likely to stay.
Risk reversal is the new marketing in the current economic climate. You have to make it as easy as possible for someone to buy from you.
im livin in Castlelake,the houses that have been completed in last two years are the ones available for rent-to-buy scheme and have been build to a good standard.i moved in three years ago and our houses were obviously the “practice run”. awkward storage,unnecessary alcoves taking up valueable space.very poorly designed kitchen with inadequate storage where needed.two radiators in small kitchen and one in huge sittingroom????? so many oversights but if i was buying in Castlelake now from the new phase it would be a different story.they are high quality.