The steady rise in prices of properties and rentals is making it really tough for people to buy their own homes, which is an alarming trend to watch out for. Fortunately, Home Partners of America and its rent-to-own plan just might provide the solution for the future of housing market in the U.S.
According to Housingwire, Moody's Investors Service wants Home Partners of America (HPA) to get the spotlight because of what it is doing to help people acquire their own properties. There are several reasons a would-be homebuyer will not push through with a home purchase. Primary among them is a low credit score and lack of savings. HPA wants to change that by buying the properties for people who want to own houses but has no means to and renting them out to them with the agreement that they will eventually be buying them.
HPA's strategy does not conform to what most real estate companies are doing -- buying foreclosed homes, renovating them and renting them out. While it is a successful model worth emulating, HPA let prospective tenants select the location of their new home and then both parties work out a deal that will allow ownership of the rented property in the future.
However, Moody's say that HPA does not go into the rent-to-own business blindly. It has a checklist it gives clients who need to comply with them in order to get approved.
Meanwhile, in a report by LA Times, Los Angeles has one of the most expensive housing markets in America both on purchase and rental prices. The average buying rate of homes is $507 per square foot while for renters they need to shell out $34 per square foot. This is indicative of how a particular neighborhood is perceived by both buyers and renters. A home in an area where there are easily available amenities like restaurants and shopping centers typically costs more but owners get more value for their money because of the availability of such establishments.
