Rent to buy is a popular scheme in Australia.  Whenever it comes to real estate, there is always a question before many people as to whether to buy a house or to go for rent.  This is a very age-old issue that needs to be tackled carefully. Lot of factors has to be taken in to account before arriving at any conclusion.  Some people feel that it is not worth investing thousands of dollars in real estate for buying a property whereas some feel that owning a house or property is always an asset. Australia is one of the few countries where rent to buy is very popular.

What is ‘rent to buy’?

Rent to buy means that you move in to a house on rental basis and whenever you feel financially comfortable, you can buy the same house.  You make rental payments as per normal residential lease agreements. There is option money or option fee which you pay initially for purchasing the property at an agreed date and price in future. Accordingly terms are agreed upon and the buying price is fixed. Later on, while purchasing the property, whatever credit balance is there, that is adjusted towards the purchase of the property. After making the final instalment, the property gets transferred in your name. It is important to note that in rent to buy scheme, the option fee once paid is non-refundable. Sometimes it happens that the buyer due to some reason or the other decides not to buy the property at a later stage. In such cases, the buyer does not get back the option fee paid initially.

Consult a Solicitor to make things easy

In this scheme, after making the final instalment and after all formalities as well as paper work are completed, the tenant can shift to the new house. In many cases, buyers are very much concerned about the whole deal as to how it works. To make things very clear, the tenant has an option to buy the house at a later stage in case he wishes to. In order to get a clear idea of the scheme, it is better to consult a solicitor and get the deal done. A solicitor will take care of the documents as well as the paperwork involved in it. The tenancy agreement also covers all the details regarding the deal about the future buying price and date. As the price is fixed, there is a contract signed between the two parties and this price cannot be changed in future irrespective of the increase in value of the property. The rent contract binds both the parties and moreover the tenant has an option to wait and watch before actually buying the property. In this program, there is less of paperwork involved and less amount of time is spent. The plus point is that you can save money. While going for rent to buy program, only the seller’s approval is required and in the current scenario, this scheme seems to be the best option for many people residing in Australia.