The controversial sale and rent-back sector – which buys people's houses and then rents them back to the former owners – is to develop a new voluntary code of practice, in a bid to raise standards and prevent further mis-selling within the industry. The Independent
The schemes have generated a stream of bad press over the past few years as stories have emerged of pensioners selling their houses for a fraction of their real value, only to be turfed out as a tenant within just months of signing the contract.
Unlike equity release schemes – where elderly homeowners take out a mortgage on their property, which is repayable when they die or when the property is sold – sale and rent-back schemes are currently completely unregulated.
The National Association of Sale & Rentback, which was established in October last year and now represents more than 200 providers, is now drawing up a voluntary code of conduct, to try and ensure customers are offered long tenancy agreements, and are made fully aware of any onerous terms and conditions relating to their schemes.