Is 'Renting to Own' a bad idea?

Recently, I am being asked by prospective renters about 'Rent to Own.'  Renting to own is misunderstood by almost all prospects I encounter.  Most people think that if they pay rent for a year or two, they will be able to buy the house at the price agreed upon at the end of their lease.  This is the snag.  A price has to be agreed to before the lease starts giving both parties an agreement as to how much of the rent will be used towards the future down payment and at what price the house will be sold at the completion of the lease or during the lease period.  During a standard rent to own term, the tenant has the option to buy the house at any point during the lease period. 

When I explain to my clients that they would have to agree to a price for the home now and should the house be worth less in a year from now, they will still be paying today's price, most decide it is not for them. Also, should the home be worth less than the agreed upon price, how will your lender get an appraisal in a year to cover the price you have already agreed to.  Well, most owners are going to want you to pay the difference in cash or simply the contract will be void. Typically, you would be paying a higher rent for the term because you are paying rent to owner to cover his/her mortgage PLUS an extra amount to be used towards a future down payment for purchase.