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It was revealed at the Cityscape Global property exhibition in Dubai that the new Villages program would have a rent-to-own financial option for potential buyers. Afterwards, interest in this arrangement increased significantly. The rent-to-own option offers a number of advantages to potential buyers, and is thus definitely worth considering, particularly when it comes to middle-income households. Souqalmal.com – First financial products comparison site in UAE and KSA - has already provided a brief insight into this scheme, which we will dive into further:
The Villages
Since The Villages are the place where potential buyers will have the rent-to-own option, we will take a closer look into the location.
The project will contain five community-based settlements of approximately 20,000 units. Construction on the first village will start in early 2016 and the whole project is expected to be finished by 2019. The Villages, to be located in South Dubai, will have a wide range of residencies of different sizes e.g. apartments, lofts, studios, etc.
The settlement will also contain a greenhouse including a botanical garden and farms where residents will be able to grow and purchase locally grown produce. Furthermore, the greenhouse will have indoor walking trails where people of all ages will have the ability to stay physically active in a beautiful, climate-controlled area.
The Villages, intended primarily for families or people who wish to start families, will have a health center as well as schools, which is why the rent-to-own arrangement is believed to become a huge success.
Rent-to-own: Why to do it?
Here are some examples why you should definitely consider the rent-to-own option:
- It’s the perfect opportunity to own a dream home – some people find their ideal home but don’t have enough money to purchase it on time. Rent-to-own allows you to have that time and purchase a home after a certain period.
- It’s ideal for people who aren’t able to purchase a home due to bad credit – rent-to-own will enable you to build equity and repair credit while renting to own your home.
- If you change your mind, you don’t need to purchase the property.
- The price is fixed and cannot be increased by the seller.
Rent-to-own: What to consider?
Below, you can see some examples for what to consider before you sign the rent-to-own contract:
- Budget – although you don’t have to pay for the property immediately, you should determine a budget and don’t go after a property that you know you can’t afford.
- Credit – the rent-to-own option is a good opportunity for people with not-so-good credit, but not being able to improve your credit during this period could cost you.
- Ask a professional – the most common mistake that people make is trying to do everything on their own. Asking a financial consultant for help and advice is always a good way to go.
- Future – think about where you see yourself in five or ten years. If you don’t think the neighborhood is right for you, then there’s no point to sign the contract.
One thing is for sure, the rent-a-home financial plan offers middle-income families the opportunity to own a home who wouldn’t otherwise be able. It started with The Villages, but there’s no doubt that other parts of the UAE will follow this example.
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