In Hong Kong, a two-tiered solution to the skyrocketing home prices experienced over the few years has been proposed. The country will stop offering residency to foreigners who buy property. The second part of the proposed changes to Hong Kong’s policy is the implementation of a rent-to-buy program.
The new rent-to-buy program will offer 5,000 units for first-time property buyers. Buyers will able to rent for up to five years before eventually purchasing.
Cusson Leung, a Hong Kong-based analyst at Credit Suisse Group AG, commented that “many of the policies announced today may have only limited impact on the property market in the near term.”
“Take the rent-to-buy scheme,” said Leung, “a lot can still happen over the next few years.”
The rent-to-buy program will let first-time property owners rent a house for up to five years at a fixed rental cost. Half of the total rent paid during the rental period will be put towards a down payment to buy the home.
According to Wong Leung-sing, a research director at Centaline, Hong Kong’s biggest privately-held property broker, “These are good measures..I think this whole policy address is a move in the right direction.”
The first stage of the project is scheduled to be completed by 2014, and will include 1,000 units in the Tsing Yi district. Officials hope the new rent-to-buy initiative, coupled with a cease in residency offers to foreigners buying property will cool home prices and allow the housing market to settle. Only time will tell.
To read the original article on Bloomberg, click here.
In September, a Waterford house builder held a first-time buyers’ event that was wildly successful. The event, held at the Greenfields development on the Old Tramore Road was packed with visitors. New-home buyers were offered purchasing help and mortgage advice.
The event also marked the launch of the new rent2buy program by Frisby Homes. The rent2buy initiative helps people buy a home by allowing them to rent it for a few years and then buying it after the prearranged time-period with an accumulated deposit.
Sylvia Doyle, sales manager, said that “feedback for the rent2buy scheme was also very positive.” Doyle reported that “two buyers bought using it. They like the idea of renting, but without the ‘dead’ money. It’s also easy to use and buyers don’t need a 100 per cent mortgage.”
To read the original article in Waterford Today, click here.
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The Greater Las Vegas Association of Realtors (GLVAR) has reported relatively steady home sales in recent years, with a slight dip in local Las Vegas home prices. President of the GLVAR and local realtor, Rich Shelton, believes the GLVAR findings indicate that the local housing market is “bouncing along the bottom.”
The most recent report by the GLVAR highlights the following facts:
- An increase in the value of local real estate transactions tracked through the MLS during the month of September by 0.1 percent for homes to more than $476 million.
- An increase in the total value of all sales of condos and townhomes to more than $77 million in September from $73 million in August.
- Total home sales in September were down 15.5 percent from last year.
- Total sales for condos and townhomes were up 7.7 percent from last year.
- In August, 68.1 percent of single-family homes and 66.3 percent of condos and townhomes sold within 60 days.
- In September, 66.6 percent of homes and 66.6 percent of condos and townhomes sold within 60 days.
- The median price of a single-family home in Southern Nevada in September was $135,000, down 3.6 percent from $140,000 in August.
- The median price of local condominiums and townhomes sold in September was $65,000, down 3.0 percent from $67,000 in August.
“We don’t like to make predictions about the future of the market. All we can say with certainty is where we’re at today and where we’ve been,” Shelton said. “but if the rest of 2010 continues to follow these recent trends, as many housing experts suggest, I think we’ll look back on this period and say we are now at or near the proverbial bottom of the housing market here in Southern Nevada.”
Shelton refers to government incentives, tax credits, and other forms of outside factors that could have an impact on the housing market. An example he cites is of the federal tax credit for homebuyers that stimulated home sales starting last summer through the end of April. After the tax credit expired, home sales have slowed.
According to the GLVAR, the percentage of homes sold due to short sales and foreclosures stayed relatively steady last month. Out of all existing homes sold in Southern Nevada in September, 30 percent were short sales. Bank-owned homes made up 42 percent of local home sales in September, down slightly from 43 percent in August and 53 percent from their most drastic peak in February. The amount of local homes, condos, and townhomes sold in September was 3,603; total sales shrunk from 3,638 in August and 4,217 one year ago.
Shelton discussed the nature of home purchases. According to Shelton, almost half of all home purchases involve cash (45.4 percent in September, 45 percent in August). He says that this may very well be the highest percentage of people buying property with cash out of all metropolitan areas.
Shelton also references the buyer benefits of increasing real estate inventories. September was the fifth month in a row that inventory categories saw an increase in the number of homes for sale. There were 11,887 single-family homes listed for sale on top of the 3,151 condos and townhomes listed. The increase in inventory for single-family homes from September 2009 to this September was 50.3 percent.
To read the original article, click here.
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“Home shoppers now have an innovative new path toward a home purchase.” – Moti Kahana, founder of Rent2Buy
(WHIPPANY, N.J.) – Rent2Buy.com, the world’s eMarketplace for renting or leasing nearly anything with the option to buy, has updated Rent2Buy Real Estate with more than 2,310,380 homes.
Rent2Buy Real Estate offers a full inventory of real estate listings across the United States. The easy-to-navigate, live server includes real estate data and seller contact info in the categories of foreclosure, bank owned, homes for sale and for sale by owner
A portion of the homes listed on Rent2Buy Real Estate are eligible for Rent2Buy’s unique “try-before-you-buy” program, a powerful new financing alternative for property seekers on the path to home ownership.
“Home shoppers now have an innovative new path toward a home purchase,” says Moti Kahana, founder of Rent2Buy.
The Rent2Buy Real Estate system allows future homeowners to rent a property with the goal to apply the rental fee as a down payment toward the purchase of that home. Or they can walk away.
For Americans with credit scores below 620—nearly one-third of the population—getting an offer of even one conventional loan quote by lenders is rare, according to loan-request analysis by Zillow.com.
“Rent2Buy Real Estate gives future homeowners the opportunity to prove their creditworthiness by paying on time and then taking ownership of the property,” says Kahana. “Conversely, sellers are exposed to a larger base of potential homeowners who are motivated to buy.”
Click here to browse the new Rent2Buy Real Estate site. Check back soon, as more and more homes are added to the Rent2Buy inventory.
To read the article on RTO online, click here.
PBS NewsHour presented a story on September 28th entitled, ‘To Rent or Buy? Housing Market Leaves No Easy Answers.’ Jeffrey Brown interviewed both Jack Hough of SmartMoney magazine and Karl Case, who helped develop the Case-Shiller Home Price Index.
To listen to the story or view the full transcript, click here.
According to Karl Case, there is mixed evidence on whether home prices have hit bottom. Home prices peaked in 2005 and have now stopped falling. Case believes we’ve reached a bottom, but that it’s hard to know whether prices will continue to fall or stay up. Despite the uncertainty, Case remains optimistic. He discusses property as a consumer durable good; he states that benefit accrues to people just from owning it, basically tax-free, at about 6%.
Jack Hough, when asked how fragile things are, makes it clear that the worst of the price plunge is over. Though certain about the end of plunging house prices, he believes we could be in for a long period (potentially a 10 year period) of disappointing returns. According to Hough, prices are lagging behind the rate of inflation. People need to remember what the normal return for a single family home looks like, and think about inflation when making decisions about homeownership.
When it comes to the question of whether it’s better to buy or rent, Case and Hough differ in their opinions.
Case points out the positive aspects of buying. He cites, again, the fact that a house is a durable good. He encourages potential homeowners to think about the yield from their purchase (you live in it, rent-free, and non-taxable). He also reminds listeners that if your house falls in value, this is not necessarily a problem if you are planning to live in your home for a long time.
Hough makes a case for renting. He says that there is nothing wrong with buying a nice house, but that there is too much talk of single family housing as an investment coming from the government. He believes houses today are seen as form of consumption, but that homes were not designed for consumption. Hough advises potential homeowners to consider whether or not they can afford it; if they can’t afford it and don’t anticipate what actually goes into it, they should rent.
The option to rent to buy a home is not mentioned by either contributor to the PBS segment. However, it is clear that there is no consensus as to whether renting or buying is the best option, taking into consideration the state of the current economy. Rent to buy is an option that potential homeowners should seriously consider when deciding whether renting or buying is the best fit for them in their current financial circumstances.
Explore Rent2Buy.com for comprehensive real estate listings and the option to rent to buy your next home.
The rent-to-buy model is intended to afford more people the opportunity to own their own home. Research by CB Richard Ellis indicates that the rent-to-buy initiative does not just benefit potential homeowners. Their research indicates that rent-to-buy real estate has the potential to unlock the housing market.
Rent-to-buy uses the private rental sector as an intermediate stage in the process of purchasing a home. This intermediate step allows both homebuyers and seller to sidestep financial constraints. This is particularly helpful for first-time buyers, and also serves as a way to allow developers to exit a residential project.
In the real estate sector, the rent-to-buy process lets prospective home buyers move into a home as a private rental tenant. They then have the option to buy the property at a pre-agreed price at a future date. Rent on the property acts as a form of savings for the buyer, as it is used to offset against the deposit at the time of purchase. The rent paid to the seller during the rental period can be used to service debt until the sale is made.
According to Jennet Siebrits, head of residential research at CB Richard Ellis, “The transfer of new build homes to the private rented sector has become a more viable and obvious exit strategy for developers because of the subdued sales environment. Rent-to-buy is an innovative solution that uses private rental as a facilitator to unblock both ends of the development equation.
“The flexibility of the model is appealing as it can be adjusted to suit the individual circumstances of the developer or buyer. However, there is a trade-off between the length of the lease and the size of the deposit.
“A longer lease will enable the buyer to save a larger deposit, but the buyer must ensure the home has an extended appeal. Developers can reduce risk by considering an upfront, non-refundable deposit of one or two per cent in case the sale falls through.”
To read more, click here.