The FSA are having a close look at the Sale to Rent or Sell to Rent market following the recent property downturn. It’s an unregulated area and now lets set to become regulated – sooner or later. The notion of buying someones house and then letting them rent it back is a fair enough idea – particularly if the homeowner wants to release cash or is about to be forced out by the bank. But…. the trouble is of course that should the buyer run into financial problems then all bets are off and the seller can find themselves homeless.
It is clearly an area that needs sorted out – people who have fallen foul of market conditions or over leveraged buyers will have wondered why it wasn’t already regulated.
The FSA stepped in a few years ago to sort out home reversion and equity release schemes – we talk about these on our financial news sites – www.nowretirement.com being one. It’s a pity (but hindsight is a great thing) that thr FSA didn’t go a wee bit further. But on the negative side the more regulation that comes in the harder it is for decent folks to get on with doing a decent job. The term equity release has been misused a lot and seems to mean many different things depending on who is presenting.
Hopefully the other decent financial products that are lumped in with the generic term “equity release” wont get caught in the cross fire.
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