“We are excited to announce that we just concluded a Rent2buy transaction for an iconic property that was sold for just under the asking price of R14 million in Tamboerskloof,” says Meyer de Waal.
The owner listed the property himself on Property 24.
The buyer, who was put in touch with the seller through a private acquaintance, fell in love with the property from the first time he laid eyes on the property.
“The seller met with the buyer, an astute businessperson with business interests in South Africa and overseas, and they immediately struck a mutual connection and it was a perfect match” says De Waal.
The question was, how to arrange the property finances?
The Seller, suggested, “Why not a Rent2buy transaction?”
We met over a cup of coffee, and I explained the structure of first providing a lease agreement, combined with an option to purchase and a sale agreement that will “kick in” once the option to purchase is exercised.
The parties agreed on the price and the monthly rental.
The buyer agreed to contribute an extra amount over and above the rental to be paid every month as a “deposit builder”. The deposit builder is regarded as an option fee.
THE DEPOSIT BUILDER
The deposit builder will be deducted from the purchase at the end of the rental term when the option is exercised to buy the property.
SAYS THE BUYER
“I am excited that I could secure the property with such simplistic arrangements.
I could move into the property within a few days after signature of the legal agreements.
One of the biggest benefits is that I will be able to reduce the purchase price with the deduction of the deposit builder saved as well as extra funds that I can pay into the deposit saver during my rental term.
This will make my arrangements to apply for property finance much easier at the end of the Rent2buy lease term to settle the balance of the purchase price.”
The Buyer will be able to work and live from his new home when he is in South Africa.
The Seller is equally excited as he found a buyer that he really likes and matches his vision as a future owner for this landmark property.
The monthly repayments that the seller will be a stable income, considering the rental to be received, plus the deposit builder.
THE RENT2BUY CONCEPT
For more information how the Rent2buy concept can work for your property transaction, whether a commercial, agricultural, or residential or even a vacant plot, contact Meyer de Waal at firstname.lastname@example.org
De Waal said, “We are excited that alternative finance solutions can pave the way to close property transactions between a willing seller and a willing and able buyer.
Our biggest Rent2buy transaction as a farm transaction, sold for R22 million Rand”.
The Mill Park development in Bredasdorp enables buyers to save 50% of their rental paid every month for 24 months as a reduction towards their purchase prices. It is expected that this reduction, combined with a FLISP subsidy that will both be deducted from the purchase price will save a buyer close to 20 % towards his or her monthly home loan repayments.
We are also working with a finance company that can provide finance in the price range between R400 000 – R2,9 million rand for alternative finance methods.
RENTAL INSURANCE FOR RENT2BUY
The introduction of rental insurance is also a game changer to provide “peace of mind” for Rent2buy landlords.
We are excited that the Rent2buy concept that was developed since 2007 is now really receiving fantastic traction and recognition in the property industry” says De Waal.
Meyer de Waal
18 October 2022
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)