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Has anybody heard about rent to own your property? Some people told me thats scammng, but some said thats great?

 

Would like to take other advices, thanks

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https://www.realestate.com.au/advice/rent-to-own-home-schemes/

Seems like a lot of hassle with a lot that can go wrong.  The article points out that you're not on the title, if the landlord goes under and the house is repossessed you'll likely lose what you've paid; and should you not be able to get finance at the end of the rental contract you will lose what you've paid as well. It also says that generally you need a deposit to sign up, and may be required to pay maintenance and insurance etc.  Doesn't sound too dissimilar from a mortgage without the security of title.

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I looked into this once.  I agree there is too much that can go wrong.   

I would say you'd be much better off to either (a) lower your expectations and buy a smaller place in a cheaper area to get into the market, or (b) rent where you want to live, and buy an investment property somewhere cheaper.

Properties in regional areas  are much cheaper so you stand a good chance of finding something you could afford.  The capital gain won't be as good - however country properties can often command high rents, and you can get some great tax breaks if you choose wisely.  When I owned an investment property, not only did I pay no tax on the rent, I got a big tax refund on my PAYE tax as well.  

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Scot by birth, emigrated 1985 | Aussie husband applied UK spouse visa Jan 2015, granted March 2015, moved to UK May 2015 | Returned to Oz June 2016

"The stranger who comes home does not make himself at home but makes home itself strange." -- Rainer Maria Rilke

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On 21/03/2020 at 09:11, Marisawright said:

When I owned an investment property, not only did I pay no tax on the rent, I got a big tax refund on my PAYE tax as well.  

It ridiculous the way so called "investors" are encouraged to make a loss from rental properties in this country. Hopefully COVID-19 will prompt the government to look at this again and finally phase this out as not only does it lose the taxpayer money is skews the housing market.

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Chartered Accountant (England & Wales); Registered Tax Agent & Fellow of The Tax Institute (Australia)

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1 hour ago, Ken said:

It ridiculous the way so called "investors" are encouraged to make a loss from rental properties in this country. Hopefully COVID-19 will prompt the government to look at this again and finally phase this out as not only does it lose the taxpayer money is skews the housing market.

TBH I don't approve of negative gearing and think the government should do away with it, but I have to admit, I did take advantage of it.  It's ridiculously generous actually - I didn't make a loss on my property in fact, I only made a loss on paper, entirely due to depreciation.


Scot by birth, emigrated 1985 | Aussie husband applied UK spouse visa Jan 2015, granted March 2015, moved to UK May 2015 | Returned to Oz June 2016

"The stranger who comes home does not make himself at home but makes home itself strange." -- Rainer Maria Rilke

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2 minutes ago, Marisawright said:

TBH I don't approve of negative gearing and think the government should do away with it, but I have to admit, I did take advantage of it.  It's ridiculously generous actually - I didn't make a loss on my property in fact, I only made a loss on paper, entirely due to depreciation.

You have to pay taxes - but there's no law that says you have to leave the ATO a tip. So, yes everyone who can should take advantage of any generosity the government offers them. It's the government generosity with regard to negative gearing that I'd like to see changed. People who own more than one house are getting tax breaks while many people can't afford to buy one? Doesn't pass the smell test.

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Chartered Accountant (England & Wales); Registered Tax Agent & Fellow of The Tax Institute (Australia)

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