Rent2Buy Concept | Rent2Buy Blog

Potential Homeowners Faced With Larger Down Payments

February 17, 2011

Posted by Sandie under News, Real Estate, Rent2Buy Concept

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Just three years ago, the median down payment for conventional mortgages in 9 major U.S. cities was at 11%. Last year, this number rose to 22%. The stiff increase in the amount of money banks require for a down payment will have a marked impact on the housing market and will undoubtedly change the behavior of those seeking homeownership.

An increase in the required down payment means some individuals who intended to purchase a home are no longer financially able to do so. This shrinks the portion of the population looking to buy a home, and thereby negatively impacts the housing market.

“There’s no question that the tightening of criteria unquestionably prices households out of the market,” says Zillow Stan Humphries, economist at Zillow.com. “The middle ground buyer is the one having to fight to get a conventional mortgage.”

The Obama administration has proposed that the minimum put down for a conventional loan be gradually increased to 10%. Private lenders are also becoming more risk averse, increasing the amount required for a down payment.

What effect will the increasing down payment requirements and the elevated cost of borrowing have on the future of the housing market?

One significant outcome will be the continuing decline of house prices. Another effect will be to push individuals seeking homeownership to consider less traditional means of financing.

The rent to buy or rent to own option will become a viable alternative for those individuals who are no longer able to afford the down payment banks and private lenders require. People with their hearts set on homeownership will most likely keep renting and trying to save up enough money to shell out for a down payment in the future. However, the act of paying rent and the intention of saving money are two conflicting financial situations.

Instead of just renting a property and trying to save money, those looking to achieve the “American Dream” of homeownership should consider renting a place with the option to buy it.

Read the full article in the Wall Street Journal.

Stricter FHA Financing Rules Signal Need for Creative Modes of Financing

February 9, 2011

Posted by Sandie under All Things Rent To Buy, Real Estate, Rent2Buy Concept

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The Federal Housing Administration has changed their condo financing rules, squeezing sellers and creating significant new challenges for the resale of some real estate projects.

According to Orest Tomaselli, CEO of White Plains, NY-based National Condo Advisors LLC, “There were 26,000 condominium developments that would have had to have been recertified by Dec. 7, 2010, and, in fact, my office sent out letters to almost every single one of these developments across the country telling them they were going to lose their approval. Most of them didn’t even know.”

While FHA-approval typically involves a substantial amount of paperwork, the benefit is easier access to FHA financing. Condominium purchasers did not necessarily need to rely on FHA funding in the past, because up until 2007, private lenders were loaning them large sums of money. For those who did want FHA financing, there was something called a spot loan that allowed them to get FHA approval for the particular condominium slotted for purchase.

“In February 2010, the FHA ended the spot loan — replacing it was a process where every single condominium development had to have project approval, which was to be given by HUD (the U.S. Department of Housing and Urban Development), which administers the FHA, and lenders that were delegated FHA lenders,” said Tomaselli. Because of the economic downturn, the presence of private lenders in the market has drastically decreased and the need for other forms of financing has again become an important consideration for developments.

While condo developments used to be able to get approval once and then be set for life, the process has changed. Developments must now get reapproved every two years. The guidelines for approval are stricter than ever, and some developments are reconsidering their need for a partnership with the FHA. But there are drawbacks to relinquishing FHA-approval. Without FHA-approval, condos are seen as less desirable and are at a disadvantage in terms of marketing and value. This is a crucial concern considering the current state of the housing market.

So, what does this mean for you? “When those condo owners want to sell their units and no one can finance,” says Tomaselli, “when buyers can’t get a mortgage because the development is not FHA- or Fannie Mae-compliant, that’s when the pain will rise and everyone will start to scramble to become compliant.”

Rent to buy is an alternative that allows buyers to pay a monthly rental payment on a property and have a portion of that payment go towards the eventual purchase price. For sellers, offering potential homeowners the option to rent to buy the property means a property does not remain vacant, but rather makes money each month until it is purchased. It’s crucial to consider creative ways of financing given the housing market’s current state. Rent to buy is just one option that can benefit buyers and sellers alike in a time when finding a happy ending for either is almost unimaginable.

Read more, in this article from Inman News.

How to Open a Store on Rent2Buy in 5 Easy Steps

January 31, 2011

Posted by Sandie under All Things Rent To Buy, Rent2Buy Concept, Rent2Buy Website

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Opening a store on Rent2Buy is really easy. And best of all, it’s free. Our e-commerce platform was created with the vision of connecting buyers and sellers on one comprehensive online marketplace. Our goal is to provide businesses and consumers a space in which to transact in innovative ways.

What makes Rent2Buy unique and differentiates us from Craigslist and other such online marketplaces is that you can choose to list your items as for sale, for rent, or as rent to buy.

Your store will be a comprehensive online marketplace where you can list your entire inventory. You can delete or add items at any time. You can upload your logo, upload multiple pictures of your items, add descriptions, and give potential customers in-depth information about your items to a degree that you can’t on other online sales platforms. In just a few short minutes, you’ll have your very own online marketplace up and running!

How to Open a Store:
1. Go to: http://www.rent2buy.com/stores/stores.aspx
2. Sign-in using a Google, FB, Twitter (etc) account, or create an account on Rent2Buy.
3. Once logged in, click the ‘open store’ button at the top right-hand side of the page.
4. Click on the ‘open a free store today’ button.
5. Fill in information about your store, upload your items, and start selling!

In a few short minutes, your store will be open and ready for business!

CAM Rent-to-Buy Program Grows, Sees Success in Overseas Property Market

January 28, 2011

Posted by Sandie under Real Estate, Rent2Buy Concept

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In early October, we wrote about a new rent to buy program launched by Caja Mediterraneo (CAM), the fifth-largest financial institution in spain. The CAM bank has been selling repossessed properties to buyers from the UK, Russia, and the Benelux countries.

Alfredo Milla, international commercial director at CAM, said “the rent-to-buy product is fairly new and innovative from our point of view, and people like the idea of renting a villa or apartment in Spain from our books for two years before having to consider the option of buying the property.”

With the rent to buy program, potential buyers rent a property of their choice for two years and get a chance to experience firsthand what it’s like to live in the area. They can see what the schools are like, get a feel for the community, and make a calculated decision about whether or not they want to ultimately purchase the home.

According to Milla, CAM sold almost 4,800 properties in 2010, 480 of those properties going to international buyers. The majority of sales outside of Spain in 2010 were to buyers in the UK, while the second-largest group of properties sold to Russia.

What’s making the CAM rent-to-buy program so successful? According to Andy Lister Cope, head of business development, it’s the program’s comprehensive reach and CAM’s ability to offer excellent service to consumers, aiding them in every aspect of the transaction. “We give a full service” says Cope. “We sell, we do after-sales and we have all the infrastructure in place. We have the keys to every property ready for inspection, and we take selling these properties seriously.”

The real key to their success? Making sure consumers view the CAM Bank’s rent to buy program as a respected and legitimate way to achieve homeownership. Though some other Spanish institutions don’t have the best reputations at the moment, CAM takes seriously its role as a provider of quality housing and affordable solutions for individuals in the housing market. Says Cope: “If you get a client who wants to buy from us, we will have all the details ready to complete. All our properties are fully owned by CAM and registered in the name of the bank, all of the paperwork will be in place, and nothing will be offered for sale on illegal land.”

In the coming year you can expect to see CAM continuing to expand its sales of rent to buy properties both in Spain and abroad. CAM has entered into strategic partnerships with TUI and the Clydesdale and Yorkshire Bank. CAM has also entered into an exclusive overseas sales partnership with a UK agency called Connells.

Read the original article in the Overseas Property Professional.

Monthly Rent2Buy Real Estate Agent Meetup – Join Us Feb 24th!

January 24, 2011

Posted by Sandie under All Things Rent To Buy, Announcements, Real Estate, Rent2Buy Concept

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At Rent2Buy, we value the input of those we serve and are always looking for new ways to reach out to our users. We have decided to start hosting monthly meetups at our New Jersey location to reach out to the real estate community and offer a forum for discussion about the industry and Rent2Buy’s role in the ever-changing real estate marketplace. The meetup is designed for real estate professionals in the area to get together, network, and learn a little bit more about Rent2Buy.

Our first event will take place February 24th from 6-8pm. At February’s meetup we will present our Agent Network Program, explain what Rent2Buy does, and give attendees the opportunity to meet members of the Rent2Buy team and ask us questions. Don’t miss this opportunity to meet other agents and learn about Rent2Buy firsthand!

RSVP on Facebook.

We hope these meetups will become a useful tool for agents to learn from each other, and from us, about how to prosper and grow despite the current state of the real estate market.

We hope you’ll join us on the last Thursday of every month for wine and cheese and lively discussion. See you in February!

Accessorize Like a Diva With Rent To Buy Handbags: From Chanel, to Gucci, to Prada

January 18, 2011

Posted by Sandie under All Things Rent To Buy, Fashion, Rent2Buy Concept

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I’m sure by now we’ve got you thinking about the endless possibilities of the rent to buy market: Rent to buy homes, rent to buy skis, rent to buy autos. But what about the market for rent to buy goods in the fashion industry?

There are several websites that let you rent or lease bags with the option to buy them. You can find big-name bags from designers like Chanel, Coach, Tracy Reese, Gucci, Fendi, Louis Vuitton, Prada, and more for rent on the web.

Why rent to buy a handbag? Many people turn to this option because it is a financially sound way to rent or buy a bag they cannot afford to buy up-front. Buying a brand name bag is a big commitment, both when it comes to the high price you pay for the designer name and quality as well as the commitment you are making to owning that accessory for life. For those of us who aren’t ready to dish out the money required for a purchase of that size and seriousness right off the bat, choosing to rent or lease the handbag first is a great alternative.

Even if you have the money to spend on a high-priced bag and can afford to walk into a store right now and buy the most expensive one, why not take some time to weigh your options and try out a bag before you buy it? The option to rent for a little while, trying as many different bags you like for however long you desire, will allow you to make an informed decision about which bag is right for you. You can rent a super trendy bag for a while, and when a new one comes out that you like better you can trade in the one you have for the newer piece. You’ll never feel obligated to keep using a bag that you no longer like, just because you spent a ton of money to buy it originally.

There are several sites on the web catering to shoppers looking to try out designer handbags before they buy them. One such site is called Bag Borrow or Steal. On the site, you can rent handbags, jewelry, and other accessories for a week, a month, or for an entire season. If you decide you want to purchase an item while you’re renting it, you can go on the site and request to ‘steal it.’ If the item you are renting can be purchased, you will be shown the rental equity you’ve earned on that item. Even when you’re renting a bag, you won’t be losing money on it if you eventually decide to purchase it.

Some other sites that offer rent to buy handbags are Bag Borrow or Steal, From Bags to Riches and All That Bags.

Washington Area Residents Face Tough Decision: To Rent or to Buy?

December 22, 2010

Posted by Sandie under News, Real Estate, Rent2Buy Concept

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Brian Vent, 29, moved to the suburbs of Virginia from Texas in 2009. He moved to Virginia in search of work after finishing a two-year Navy flight program. Since he moved to the area he has rented two apartments, and now lives in a house in Vienna with a couple of roommates. Vent favors renting for several reasons. He cites the flexibility it gives in an uncertain economy, explaining that “If something were to happen with the economy or my job, I could move again at the snap of a finger.” According to Vent, renting is a financially responsible thing to do.

According to a Fannie Mae survey released last week, more than half of all renters polled cited “financial benefits” as the foremost reason they choose to rent. In January, 54 percent of renters said that they’d rent again next time they move, a number that has now increased to 59 percent. Out of all of those surveyed, renters and homeowners alike, 33 percent said that they were more likely to rent their next property than buy it.

Of those renters who plan to own next time around, 50 percent probably won’t have enough income to get a mortgage on a median-priced home. Many people in the market to rent or buy have bad credit, do not have enough money to make the large down payment required by lenders, and/or have additional properties they previously owned before moving to the Washington area that they can’t get rid of.

Many of those moving to the D.C. area are shocked by the high rents they are met with when they arrive. Ari Zimmerman studied at Indiana University, and paid 600 dollars for what he characterized as a “stunning” four-bedroom apartment. He moved to D.C. post-graduation to pursue a job on Capitol Hill, and now faces a rent of 1,500 dollars a month for his three-bedroom U-Street apartment.

Because so many people want to rent, landlords are able to raise rent while cutting back on concessions. According to Joan Caton Cromwell, an agent in Chevy Chase, renting in the area is much different than it was just a few years ago. Cromwell witnessed a bidding war over a D.C. condominium. Three years ago, the condominium was unoccupied for several months. This spring, it flew off of the market in no time. “I immediately had three applications, and I could have taken more,” said Cromwell. “We got a couple to sign a two-year lease because they wanted it so badly, and they’re paying $200 more a month than the last tenant. That is $2,500 without parking, which was included in the rent before.”

There are about 12,500 more apartments occupied by renters through the end of this year than there were at the same time last year. A survey completed in the third quarter showed 16 percent of apartment projects with waiting lists. Of those without a waiting list, many had only 1 or 2 units available.

With the slowdown of the economy, developers slowed the expansion of apartment projects. This slowdown has left a large gap between the demand for rental apartments and the supply thereof. As vacancies continue to be few and far between, rents continue to climb. According to Grant Montgomery, vice president at Delta Associates, rents will continue to rise in the next two years, due to the lack of new openings and opportunities for renters to get their hands on the rental spaces they demand.

For all of the individuals whose situations we discussed above, neither renting nor buying is the ideal option. Some see renting as the most fiscally responsible decision because it is the most sound option in the short-term. But when looking at the bigger picture, people are not always satisfied with the effects of their short-term decisions. A rent to buy option would be extremely valuable in such cases. If someone like Brian Vent thought he might end up staying in D.C. in the future, a rent to buy transaction would allow him the flexibility he values. For any hesitant renter looking to make a decision in his long-term interest, the option to rent to buy a property will surely satisfy his needs.

Should Washington area residents rent or buy? We think they should rent to buy.

Click here to read the original article.

Rent2Buy in the Huffington Post

December 15, 2010

Posted by Sandie under News, Real Estate, Rent2Buy Concept, Rent2Buy Website

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At LeWeb this year, we had the chance to chat with other companies and start-ups and learn from their vision and what they do. We also had many opportunities to explain to others what we, at Rent2Buy, are trying to accomplish. Vivian Norris, one of the people we ended up chatting with, also happens to be a blogger for the Huffington Post. She really understood what Rent2Buy is all about. And she likes our blog!

This is what she had to say:

“Another company I happened upon by chance at lunch when I sat down at a table with one of the founders of Rent2Buy, which started in the US, and which has a blog I like. The reason I liked this company and what I heard from its owner was that it seemed to be a win-win for both consumer/potential buyer and the seller. During the financial crisis there are indeed opportunities and one part of this company helps both those selling their homes, who are having a hard time finding buyers, and those who cannot yet buy, or who have gone through a tough time, to build up both a positive credit history as well as a down-payment as their rental payments go towards the purchase of the property they are renting. Worst case scenario, you rented it and lived in it. Best case, you are buying a home in an affordable way and not throwing away money on a rental, and are not going to become another subprime default tragedy. This company has been increasing listings around the world and creating strategic partnerships.” (Read the full article here)

We’re excited to see others are as enthusiastic as we are about the rent to buy concept. Thanks for the shout out!

Thinking About An RV? Try It Before You Buy It.

December 14, 2010

Posted by Sandie under All Things Rent To Buy, Autos, Rent2Buy Concept

1 Comment

At American Adventure RV, you can try out an RV before you buy it. The Rent to buy program allows you to rent a camper or motor home, try out the “RV” experience, and decide whether or not you want to buy it. Up to 100 percent of the rental price can be applied towards your purchase of the RV.

The rent to buy discount that you receive can be applied to all of the rental units listed for sale and owned by the company. Seasonal discounts on RVs are available at the season’s close; you can end up with a great opportunity to try out the RV before you buy it, AND buy it at a discounted price.

Steps:

Rent a pop up, travel trailer, or motor home
Decide on the unit you’d like to purchase
Come up with the money for the unit (American Adventure RV takes care of the rest)

Using a rent to buy transaction in this case lets you try out an RV for a while and decide if it’s something you want to buy. If you don’t want to buy, you can walk away, no pressure. If you do, you can be sure you’re making an informed decision about what you want from your RV. AND you can feel confident knowing that 100 percent of your rental price is deducted from the money you put towards your purchase.

To better understand the specifics of how the American Adventure RV rent to buy program works, check out their site.

Pelican Brings Back “Option To Buy” Program for Skis, Boots, and Boards

December 3, 2010

Posted by Sandie under All Things Rent To Buy, Rent2Buy Concept

2 Comments

Pelican Shops offer skiers and snowboarders on the East Coast great deals on ski and board rentals. This year, they are bringing back their “option to buy” program.

How the program works: You pick out a NEW ski, board, or boot. You lease the item for the season, and if at the end of the season you decide you like it, you can keep the item and Pelican will keep your deposit. If you decide the equipment’s not right for you or you simply decide you don’t want to keep it, you can return the equipment and Pelican will refund your deposit. If you want to try out something different, you can also apply that deposit to a different set up.

Pelican is even offering a free lift ticket good for 12 mountains in the NJ/PA area with every purchase of an “option to buy” package. Click here to view more details about the option to buy program.

We think it’s great that Pelican is offering people a way to rent to buy their ski and snowboarding equipment!

Rent2Buy Blog

Potential Homeowners Faced With Larger Down Payments

Stricter FHA Financing Rules Signal Need for Creative Modes of Financing

How to Open a Store on Rent2Buy in 5 Easy Steps

CAM Rent-to-Buy Program Grows, Sees Success in Overseas Property Market

Monthly Rent2Buy Real Estate Agent Meetup – Join Us Feb 24th!

Accessorize Like a Diva With Rent To Buy Handbags: From Chanel, to Gucci, to Prada

Washington Area Residents Face Tough Decision: To Rent or to Buy?

Rent2Buy in the Huffington Post

Thinking About An RV? Try It Before You Buy It.

Pelican Brings Back “Option To Buy” Program for Skis, Boots, and Boards

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