Rent to Own Condo: Benefits & How it Works?
Written By: Mariko Baerg, REALTOR of Bridgewell Real Estate Group
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**there are currently no rent to own opportunities at the moment
Rent to own condos in real estate are a unique model that offers the renter the option to purchase the home after renting for a period of time.
Have you heard? Port Moody is offering a rent to own condo opportunity for home buyers at 50 Electronic Avenue.
Read more for everything you need to know about rent to own condos, the benefits, and this amazing opportunity in rent to own condo in Port Moody.
Rent to Own Condo Real Estate Model
Rent to own means that you rent for a certain period of time, with the goal of eventually buying the property.
How it usually works:
- The tenant/buyer agrees to put a small down payment towards the property which is later used toward the purchase price of the property (this fee is typically 2-4% in the current market, and can be seen as a deposit for purchase)
- The tenant/buyer makes monthly payments of which a portion goes toward the down payment (in the case of 50 Electronic Avenue, this amount is $1,000 a month rent for a one-bedroom unit, or $1,200 for a two-bedroom)
- During the time of “renting”, the tenant/buyer then works to improve their credit score and increase their savings so they can be deemed less risky in the eyes of a lender
- At the end of the Rent-to-Own program, the tenant/buyer then applies for traditional financing through a mortgage lender & purchases the home they’ve been renting!
The idea behind rent to own is that the initial down payment (“fee) made will later be used toward the buy-out price of the purchase and that your continued monthly rent will have a portion allocated to your future down payment.
An idea similar to this is car leases, which can be bought out at the end of a lease term.
Benefits of rent to own condos
Saving for a down payment is one of the hardest parts of getting ready to be a homeowner. If the real estate market moves faster than your ability to save, then you could be priced out of the market before you can save for the minimum down payment to purchase.
Additionally, if you’re already renting, it can be difficult to pay your rent money, groceries, other expenses AND save all at the same time.(For tips on how to save for a down payment, check out this blog: Best tips for saving for a down payment to purchase a home)
The rent to own real estate model also helps individuals that may have trouble receiving financing due to poor credit, lack of consistency in pay, or other “risky” traits deemed by mortgage lenders.
Ultimately, the Rent-to-Own real estate program gives you the ability to begin investing in owning a home today and avoiding the cash pit of rent.
Example: Rent to Own Condo Port Moody *No longer available*
50 Electronic Avenue near Rocky Point Park in Port Moody was being marketed to buyers with a unique twist! Electronic Avenue, run by Kush Panatch of Panatch Group, is offering a unique ownership model – rent to own condos.
Since it’s launch in January 2019, Panatch has said more than 500 applicants have expressed interest in the rent-to-own program. Out of the 358 units available in the development, 30 of them will be given on a lottery basis as rent-to-own condos. The allocation of rent to own condos between the two-building complex will be 12 in the project’s first phase, and 18 in the second phase.
To be eligible, prospective buyers must:
- Already live and work in Port Moody
- Qualify for a mortgage
- Have to commit to living in the unit as their principal residence
In the event the participant is selected, the price for their unit will be locked in and agreed to in advance. Then, they’ll pay $1,000 a month rent for a one-bedroom unit, or $1,200 for a two-bedroom, for two years once construction is completed in 2021. The rent money will be put into a trust account and then applied towards the purchase price at the end of the two year period.
About 50 Electronic Avenue
50 Electronic Avenue is a two-phase development comprised of 358 residential units. The two buildings are each six stories and include a contemporary collection of 1, 2, 3, and 4 bedroom homes.
Only 30 homes (1 bed & 2 bed only) will be offered under the rent to own model, 12 in the first phase and 18 in the second phase.
Electronic Avenue is situated in a prime Port Moody location, directly across the street from the 9 acres Rocky Point Park and just west of desirable Klahanie and Suterbrook Village. The buildings are easy walking distance to shops, restaurants, Brewers Row, and both Ioco & Moody Centre Skytrain stations. Access to the Westcoast Express, an express train into Vancouver’s Waterfront station is only a 10-minute walk away.
The development also features Club 50, a three storey 9000 sqft amenity building with social, fitness, and family facilities exclusively for residents of 50 Electronic Avenue. The building is said to include:
- Fitness facility
- Yoga studio
- Dog wash room
- Bicycle repair room and workshop
- Indoor and outdoor youth activity area
- Arcade
- Media room
- Co-working space complete with two boardrooms
- Social lounge with a large patio
- Guest suite for visiting friends and family
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If you’re looking to hire a realtor with experience to help guide you through the process of buying a home, then reach out to us today at [email protected] or 604-319-2020 for realtor representation!
