I've been thinking about housing and the problem of rent recently and I came up with a simple idea that I'd like to explore further: what if renting a property transferred some ownership over time? Unfortunately though, I'm not sure what this form of ownership is called in the literature or if it's even theoretically viable. I'll outline what I have in mind below:

For example, a specific time period would be set (say 20 years) over which ownership of a property would be fully transferred to a renter i.e ownership transfers at a rate of 5% per year. This would make the vast majority of properties shared ownernership and, while this would legally be very complex, the rough image I have is as follows:

  1. Renting a property for x time period gives you right of ownership of the property for the same x time period, but starting in 20 years time. This way the orignal owner can still rent the property out as normal for 20 years but during anyone's tenancy, they are building up a financial stake in the property.

  2. Liabilities and managing control are tricky, but I think management costs and liabilities would have to be paid according to share size (possibly scaled or categorised in some way based on how soon your ownership period is) and managing control could be softly detached from financial ownership, similar to the existing model for public corporations.

In terms of what this would do to the price of rent/house prices, my best guess is as follows:

In order to maintain the existing rate of return for a would be landlord, the expected value of the property in 20 years time would need to be added to the total rental income over the 20 year period. Assuming that 20 years is the time it currently takes for a landlord to recoup their investment, then the Rental Income/House Price ratio would have to double i.e in the worst case, rent would double. My gut feeling though is that a lot of this burden would be shouldered by falling house prices, owing to the fact that, in the UK at least, house prices are currently well inflated over the material value of the building.

I've thought of a few other problems and potential solutions, but I've not yet thought of anything that seems completely fatal to the idea. Is it impossible for some reason I'm missing or is it already a well studied idea?

Thanks in advance.

  • 1
    $\begingroup$ What do you mean by "the problem of rent"? $\endgroup$ Commented Aug 12, 2021 at 9:53
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    – 1muflon1
    Commented Aug 12, 2021 at 12:49

1 Answer 1


The concept is rent to buy (or rent to own, or rental purchase), and exists in practice. See here for more.

It can be an option for would-be buyers who won't get a mortgage currently, and may be subsidized by the government.

I am not familiar with the academic research on that type of arrangement, but "rent to buy" on google scholar gives you quite a few hits.


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