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December 5, 2022
4 minute read
It’s tough being a first time buyer in today’s economic turmoil. As well as the cost of living crisis making it nearly impossible to save for a deposit, the government’s Help To Buy scheme is coming to an end and high loan-to-value mortgages for first time buyers are few and far between. So we’ve asked Keyzy, a new form of Rent to Own, to tell us how they can help.
Keyzy is a London-based ‘rent to own’ start-up helping customers onto the property ladder. Customers locked out of traditional financing can instead rent their ideal home, lock-in a pre-agreed price, and then buy it from Keyzy when they are ready. To help buyers become mortgage ready, Keyzy also converts some of the monthly rent towards reducing the buy-back price. In other words, the longer someone rents the home, the lower the buy-back price will be at the end of the lease. This is a new solution and Keyzy’s first customers have already moved into their new homes with many more in the pipeline.
Keyzy’s rent to own scheme is initially supporting First Time Buyers and Key Workers in England and Wales with at least £30,000 household income. Applicants must be over 18 and have the right to live and work in the UK.
You don’t need a deposit! As Keyzy is buying the home on the customer’s behalf, there’s an upfront survey & valuation fee of £999 to get started once you’ve found a home and a product fee of £1,999 once Keyzy has bought your home. Customers can keep their nest egg aside until they’re ready to get a mortgage, or even use it to upgrade their home before they buy it.
Keyzy gives applicants a budget based on their income. This budget is much like an Agreement in Principle that you would get from a mortgage lender. This is not capped at a fixed multiple of someone’s income and will increase for joint applicants bringing a second income.
Before finding a home, Keyzy customers will need to complete a short application and, once approved, they can start looking for their ideal home within their budget.
Keyzy doesn’t limit the homes you can buy to a few developers and new builds. They accept most types of freehold homes for sale on the open market with a few conditions such as being in a good and liveable condition.
Once applicants find a home they like, Keyzy will review it and provide a detailed quote so customers know exactly how much it will cost to rent now and later buy. Then Keyzy takes over the buying process from initial negotiation all the way through the legal stuff until it’s time to move in. So it’s hassle free for you.
One of the challenges with renting is that tenants don’t feel like the home is theirs. Keyzy lets you make it their own, allowing re-decoration and even making changes to the home that could add value. If making structural changes or adding a new kitchen Keyzy will need to give permission, but the gains are yours to keep. Customers are also responsible for general maintenance and upkeep around the property apart from Gas and Electrical safety.
You can buy your home at any point. If you choose to wait until the end of your lease (typically between 3-7 years) then you only have to pay the buy-back price, plus conveyancing costs and stamp duty. If you choose to buy before the end of the lease period there is also a 2% early exit fee, much like a mortgage.
If you don’t want to buy the home because your circumstances have changed, you can find another buyer and sell it (minus a 2% fee). If the property has gone up in value you can keep any gains above the buy-back price and use the cash for your next purchase
Let’s look at an example:
Let’s say you find a home at the average price in the UK – £283,000. Keyzy will negotiate a good price for you and manage all the buying process. Your locked-in price including taxes and legal fees could be £305,000.
Keyzy will charge you rent based on comparable amounts in your area depending on the type of home. Let’s use £1,710 in this case. This is fixed for around four years. Keyzy then adds up to £570 (25% of the total) which you also pay each month, which gradually discounts your buy-back price.
After 5 years you’ve accumulated £34,200 in converted payments. Discounted from your locked-in price this means you would have to pay £280,685 to buy the home!
Finally, imagine house prices rise, at a much slower rate than in recent years, say 2% each year. This means the home could be worth £312,000 on the open market. You buy it for £31,315 less than it’s worth if you were buying on the open market. You will then have ready-made equity the moment your name goes on the title.
Start your path to home ownership with Keyzy
March 25, 2025 
