Rent to Buy offers people the chance to rent a home at a lower rent, helping them save for a deposit over time to eventually buy their home through Shared Ownership. Read our complete guide to Rent to Buy and see if it's right for you.
What is Rent to Buy?
We understand how difficult it can be to get a foot on the property ladder these days. Too often people are forced into completely changing their lifestyle or making big sacrifices, like moving away from family, friends and work, just to be able to save for a deposit to buy their own home. For many, the idea of ever being able to afford to buy in London feels out of reach.
Rent to Buy offers people the chance to rent a home at a lower rent (with a discount of 20%), for a period of 2 years, helping them save for a deposit over time to purchase the home through Shared Ownership.
Read our complete guide to Rent To Buy below.
Complete guide to Rent to BuyHow much could I save with Rent to Buy?
Rent to Buy is designed for people who are earning enough to qualify for buying a home through Shared Ownership, but have not yet been able to save enough for a deposit.
You can rent a home while saving for a deposit during the 2 years you're renting with us. See how much savings you can make to contribute to your deposit.
Example: 1-bedroom apartment
Minimum annual household income - £45,000
Cost of your home - £380,000
Reservation fee - £99
Five weeks' deposit - £1,270
Market value rent (monthly) - £1,400
Monthly rent you will actually pay (-20%) - £1,100
A 20% discount on your rent means you can build up savings of £7,200 in just two years.
Am I eligible for Rent to Buy?
Eligibility will vary depending on which development you are looking to buy in. However, there are some general criteria that you must meet for every development.
- My household income is not more than £90,000 a year
- I don’t own a property already
- I live or work in the area i am hoping to buy
- I am willing to agree with you a sustainable amount I am able to save every month whilst I am renting my new home
- I can afford the monthly Shared Ownership costs at the moment, but don’t currently have a large enough deposit to buy through Shared Ownership or outright
- I am able to show that I can obtain a mortgage based on my current credit report
- I am able to pass money laundering and fraud checks
- I am hoping to buy a home big enough to suit my current needs
- I am able to get a good tenancy reference from my current landlord
Buy your home with Shared Ownership
Once the initial rental period is over, you should be in a position to buy your home through Shared Ownership, using a combination of the deposit you have saved and a mortgage arranged by yourself.
Owning a Shared Ownership home, means you buy a share in the property and pay rent on the share you don’t own. You can buy as little as 25% or as much as 75% of the value of the property initially, and you’ll need to take out a mortgage to do this. Although you may be officially ‘renting’ a proportion of the home, legally you become an owner-occupier, not a part tenant.
Shared Ownership is a part buy/part rent scheme that makes it possible for first-time buyers to purchase a property with a smaller deposit compared to buying on the open market.
Learn more about Shared Ownership
Search all homes by Peabody
All our Rent to Buy homes are now reserved. In the meantime, use our property search to discover other ways to buy a home including through Shared Ownership and London Living Rent.
Find out what our homeowners say
Buying a first home, getting married and preparing for the arrival of a baby are all busy life events. Raph and Jaye would know, after experiencing all these milestones simultaneously. They purchased a 25% share of a two-bedroom apartment at The Switch in Wimbledon, with a £42,600 deposit.
READ ALL THE STORIES
After spending years renting in London, wealth manager Aroma Khan purchased a 30% share of a three bedroom apartment in Queensbury, northwest London. She had no idea that, just two years later, she would be staircasing her way up to 100% ownership with a friend.
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Luca moved to London from Italy to work at a university. After a few years renting in London, Luca was able to purchase a 50% share of a bright two-bedroom, two-bathroom home through Shared Ownership at Arden, in Lewisham.
READ ALL THE STORIES
Shared Ownership
Shared Ownership allows buyers to own a share in a new property and is designed to make homeownership more accessible for those who have smaller deposits and may not have the budget to buy a new home outright.
London Living Rent
London Living Rent is funded by the Mayor and it's a type of intermediate affordable housing for middle-income Londoners who want to build up savings to buy a home. London Living Rent is designed to help people transition from renting to shared ownership meaning that money you save on rent can go towards a deposit for your own home.
Resales
Shared Ownership resales are pre-owned homes that the current owner now wishes to sell on. By buying a resale home, you are still buying through Shared Ownership. Read our guide below to find out what it means to buy a Shared Ownership resale home.