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Our rent-to-buy model offers a long-term solution to the housing affordability crisis that exists across England and Wales by removing the principal barriers to home ownership.
We provide a route for those on lower to middle incomes renting in the private and public sector to move into an attractive new home and save for a deposit to buy that home.
Our USP is that we remove the principal barriers faced by lower-income workers who want to move into a brand new home. We give them time to save a deposit and build a good credit rating and we give them 10% of the purchase price to boost their savings when they are ready to buy, after five years.
We buy new, attractive, affordable homes from developers under section 106 and let these on 20-year full repairing leases to Registered Providers (RPs), which manage them on our behalf.
The RPs are responsible for the repairs and maintenance of the properties and retain 25% of the rent they collect. Many RPs use this to invest back into their social housing stock. This can include funding planned repairs for the 20 year period, or providing services such as debt counselling to all their tenants.
The RPs work with Local Authorities (LAs) to allocate the homes to local people on their housing lists who want to get on the property ladder.
Successful applicants move in and pay an affordable rent for between five and 20 years. This gives them time and more disposable income to save towards a deposit.
At the end of the tenancy, our tenants will be buying 100% of their home. When they do so we give them 10% of property’s value as a gift to boost their deposit and they use this to secure a high street mortgage.
We can replace sold homes on a one-for-one basis, subject to local planning. These become available to our partners for allocation to new local families who aspire to homeownership.
We receive 75% of the rent collected by the RPs. This is used to service our investor debt.
We also receive a small management fee on the cash we deploy buying houses, a small transaction fee when a resident buys their home, and a per-unit management fee. This income covers our fixed and operating costs.
The receipts from house sales are used to buy more houses and profits will be returned to shareholders in the form of dividends. We will replace sold homes on a one-for-one basis, subject to local planning.
All our homes meet and often surpass the latest government guidelines on sustainability, minimising their carbon footprint and therefore their impact on the environment.
Our strategy represents a high-quality, low-risk revenue stream based on dividends and capital receipts. As the income is from affordable housing, we are a pure-play impact investment offering exposure to the ‘S’ in ESG investing.
The very first Rentplus tenants who moved into their new homes in 2016 without any deposit, have started to buy their homes. We are on target to sell 100% of the first tranche of planned sales, compared with just 7% for the government’s Rent-to-Buy scheme.
Unlike shared ownership or other models, Rentplus tenants are buying 100% of their home, using a high street mortgage, with the benefit of their 10% gifted sum to augment their savings. For most this equates to a gift of over £20,000, and instantly giving them 10%++ equity in their home.
Rentplus really is turning renters into homeowners.
We are ready to play a much bigger role in helping solve the UK’s housing crisis with our ambitious, innovative, entrepreneurial approach. Our model can deliver affordable housing at scale, fully funded without any government money across England and Wales
Our team has already identified in excess of 32,000 properties that fit our exacting criteria. Rentplus has already demonstrated that this approach works.
In 2021, the first tranche of Rentplus tenants successfully completed their Rentplus programme and are now homeowners, having moved in with no deposit in 2016. They are buying 100% of their home, unlike with Shared Ownership, Help to Buy and First Homes.
Rentplus has demonstrated that its model is the only model on the market that can take people in housing need and successfully support them to transition into home ownership, in some case in just five years. Our new homeowners say that they could not have achieved their dream without the help and support of Rentplus.
We want to see our affordable homes on every new housing development across the country, opening up the opportunity of home ownership to millions of hard working people on lower and middle incomes and helping create diverse, stable communities.