Rent to Buy by BrickX

Discussion in 'Innovative Property Investment Techniques' started by House, 13th Jun, 2019.

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  1. House

    House Well-Known Member

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    o_O

    “Well, we have some REALLY EXCITING NEWS that could get you into the home of your dreams in weeks... not years!

    You and BrickX choose the home.
    Your name, and ours, are on the title.
    You live in the home and pay market rent.

    BrickX is building a brand new product called Rent to Buy by BrickX* and it gives you the opportunity to purchase your first home with just a 5-10% deposit.

    When you are ready, or at the 5 year mark, you have the option to buy the remainder of the property or to sell your proportion”
     
    House, 13th Jun, 2019
    #1
  2. Trainee

    Trainee Well-Known Member

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    Run fairly, rent to buy can work well.

    Lots of pitfalls, though. How do they determine how much property you can buy? What happens if you fall behind on rent? What happens if you cant buy the property within 5 years? How much stamp duty do you have to pay now and in 5 years? Mostly werent there legal issues with rent to buy in australia in a few states?
     
    Trainee, 13th Jun, 2019
    #2
  3. geoffw

    geoffw Moderator Staff Member

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    There were issues with one vendor finance type promoter in particular - Rick Otton.

    This article covers some of the perils of vendor finance in general, and Rick Otton in particular.
    Vendor finance and rent-to-buy schemes - CHOICE
     
    geoffw, 13th Jun, 2019
    #3
  4. Simon Hampel

    Simon Hampel Founder Staff Member

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    There is literally nothing I could find online about this - so there no further information available yet. Obviously hasn't been publicly announced?

    Having both names on the title would solve a lot of the issues that many vendor finance arrangements have - but there is still so much room for things to go wrong, I would really like to dive deeper into exactly how they plan to manage some of those risks before commenting.

    I believe the main issues in states like SA are about when title passes to the purchaser - but in this case, it seems that they are looking to treat it more like a JV arrangement, which presumably avoids that - since the purchaser is already on title and thus has (at least some) rights.
     
    Simon Hampel, 14th Jun, 2019
    #4
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  5. spludgey

    spludgey Well-Known Member

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    I think a startup that could potentially millions would be to set up a facility that easily and reliably connected landlords/vendors and tenants/buyers. Organised all the paperwork and acted as a mitigator if issues arose.

    Who wants in? ;)
     
    spludgey, 14th Jun, 2019
    #5
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  6. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Rick Otton wasn't the only one with issues in a vendor finance business. I've seen quite a few vendor finance deals. Very few of them work out as well as people hope it will.
     
    Peter_Tersteeg, 14th Jun, 2019
    #6