Homebuying too pricey? Developer introduces rent-to-own program
An innovative new rent-to-own program is offering hope to Vancouverites who feel like they’ll never be able to afford their own homes.
Sean Jarvis would rather buy than rent, but the 25-year old has watched housing prices climb out of his reach in recent years.
"It's a little bit intimidating. Ideally I’d like to own a place within in the next few years, but it seems a little unrealistic," said Jarvis.
Even the tiniest of condos in downtown Vancouver can cost hundreds of thousands of dollars to buy. It can be a depressing thought for 20-something Vancouverites who see no other option but to rent.
"It feels like it’s going to take a long time to have enough money to put down a down payment for a place. Even if it's a tiny place," said Andrea Leitner.
So the Vancouver-based Bosa Properties has come up with a solution, called the Bosa Equity Plan.
Under the plan, 15 per cent of a tenant’s monthly rent goes into a credit account. That money can then be used in the future for a down payment on a new Bosa home purchase, to a maximum of three per cent of the home’s value.
For a one bedroom suite that rents for about $1645 dollars a month, that means $240 would go into a special credit account. Over the year, that adds up to about $2,900. Over five years a tenant would save $15,000 that could be put toward the purchase of a brand new Bosa condo.
Renters have up to 24 months after terminating their rental lease to spend the credit on a new Bosa or Blue Sky Properties home.
"At the end of the day they get the peace of mind knowing that you know, their rental is building some equity, which is really unprecedented, and there's no catch, " said Daryl Simpson, Bosa Properties senior vice president.