Sussex businesswoman launches new 'rent to own' property company
A sussex businesswoman has launched a new ‘rent-to-own’ scheme for people struggling to get onto the property ladder.
Entrepreneur Sheila Smith has set up a company called BeHomed as an alternative to existing government-backed rent-to-buy or housing association schemes.
She said: “I want to shift the narrative away from ‘greedy landlords’ to ‘mutual opportunity’ by connecting those looking to exit the rental market with aspiring homeowners blocked by deposit requirements or mortgage restrictions.
“It’s demoralising to be saving for a deposit as house prices accelerate away from you. My approach means people can move in straight away and know that their rent is already helping to buy their home in full.”
Sheila, from East Grinstead, said the scheme works by BeHomed buying a property at today’s market value, then agrees a fixed future price for a tenant to buy it in five years. Typically, she says, this price factors in average UK house price growth of around four per cent per year. For example, a home bought for £200,000 today would be offered to the tenant for £243,330 in five years.
“If the property ends up worth more, the extra equity goes to the buyer,” said Sheila. “If not, we can sometimes extend the rental term. Either way, the tenant has the right – but no obligation – to buy.”
BeHomed funds the purchase by mixing private investment and traditional mortgages. The tenant pays a fixed monthly rent that covers mortgage costs and some interest to investors. A monthly top-up also helps build a deposit, aiming to make the tenant mortgage-ready by the end of the term.
When the time comes to buy, the tenant needs to cover standard purchase costs – mortgage broker fees, legal fees, and stamp duty if the property exceeds £125,000 or £300,000 for first-time buyers.
“Many landlords want to exit the increasingly tough UK rental market due to rising interest rates and regulatory changes. BeHomed gives them a fair way out – while offering tenants stability and a clear roadmap to home ownership.”
Unlike shared ownership schemes, often criticised for locking people into partial ownership and escalating costs, BeHomed enables clients to own 100 per cent of the home, says Sheila.
“With us, rent stays fixed, and the final price is agreed from day one. It gives people certainty – and dignity.”