Disillusioned landlords are turning to a new rental niche, it’s claimed by a firm called BeHomed.

It operates a rent-to-own business model which it says is designed “to support aspiring homeowners while helping landlords reduce the day-to-day pressures increasingly associated with traditional buy-to-let ownership.”

And it goes on to say this model meets demands from landlords for professionally managed portfolios with high yield strategies.

It works like this.

Landlords allow the company to place a vetted tenant-buyer into the home. 

Residents work towards purchasing the property over an agreed term, while landlords get fixed monthly payments and a pre-agreed future sale structure.

It claims to provide landlords with stable monthly income, reduced void periods, less day-to-day management, fewer tenant sourcing pressures and a defined long-term exit strategy.

For would-be tenant buyers the set-up cost is £1,499, paid in three stages.

There’s a £99 admin fee on acceptance, a £500 sourcing fee when the platform begins the property search, and a £900 contracts fee when the tenant-buyer approves a property. 

Before moving in, they’ll also make an initial purchase contribution of 2% to 5% of the agreed property price, which goes toward the future purchase.

The service says properties are typically offered to the tenant to purchase between two and seven years after move-in.

And the BeHomed website adds: “After the agreed time, you’ll have the option to buy the house at the price agreed upon when you signed up. The contributions you’ve made go toward the purchase price of thehome. When you’re ready to buy, we’ll connect you with our trusted mortgage brokers to help you find the right mortgage for you.”

Founder Sheila Smith says: “We already have a significant waiting list of people across the UK actively looking for suitable homes … which demonstrates how much demand there is for flexible pathways towards homeownership.

“What landlords are increasingly looking for is stability, predictability and reduced operational friction. 

“Our model is designed to provide that while also helping tenants work towards owning the home they live in.”

BeHomed says its model has been inspired by the long-established rent-to-own sector in the United States.

The company is currently seeking discussions with landlords who are reviewing existing portfolio performance, who want to reduce operational involvement, are considering future portfolio exits, are worried about red tape and EPC changes, or are exploring alternative long-term rental strategies.