With thousands of young people heading off to Universities around the country and with the sharp rise in tuition fees more people are looking for alternative solutions to expensive renting and what can seem to be ‘dead money’ payments.
Personal Property Agent, Terry Brooker is discovering that more parents are choosing to invest in ‘Rent to Buy’ products as a way to provide comfortable and safe accommodation for their child through higher education, and by renting out additional rooms to other students they can actually contribute to their own fees.
Terry explains how it works: “With a rent to buy option over an average of three to five years, for a four bedroom property worth around £200K, a small deposit of 3-5% is required. With three/four extra rooms available to rent for £400 each an income can be generated that more than covers the overall rental cost, leaving a surplus that can help support a young person during his or her studies.”
“The average deposit required for a buy to let mortgage stands at around 20%-25% so the ‘rent to buy’ option is more affordable from the outset too.” Terry continues: “and during the term of tenancy, any additional equity realised over the term of the agreement will be retained by the purchaser.”
“Now is the perfect time for investors or parents to make some creative but financially sound decisions regarding property and at the same time support their child through their University education at no cost to themselves or their child’s study time. Although the market has been reported to be rather static in reality there are plenty of workable and profitable solutions for both buyer and seller.” Terry concludes.