Anyone sell or buy a home on a lease option?

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Rx Wizard
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Been reading up on these. Just finished a book by Wendy Patton and was wondering if anyone here has firsthand knowledge of this? Seems like something you could do make some money at if you are a good negotiator.
 

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seeing that i replied , you probably thought " great , here we go again " .

but on the contrary..

i dont think buying a house on a lease option does anything for the buyer other than give them some extra time . if if was seller , i wouldnt offer any incentive to a buyer wanting to do this.

the seller has to hope the buyer doesnt change his mind during the option period . i would ask for a large non refundable down payment if i were the seller.
 

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hey ice, sue and ed want to talk to u in person to see what u want to offer or what the three of u can come up with. call when your ready to negotiate
 

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I wish I leased my home instead of buying - that way I could just give it back!
 

Rx Wizard
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seeing that i replied , you probably thought " great , here we go again " .

but on the contrary..

i dont think buying a house on a lease option does anything for the buyer other than give them some extra time . if if was seller , i wouldnt offer any incentive to a buyer wanting to do this.

the seller has to hope the buyer doesnt change his mind during the option period . i would ask for a large non refundable down payment if i were the seller.


They say (not sure as I have never did one but may do a few) that if you do one right everyone wins.

Good point about your large non refundable option payment. These are my only problem with lease options. They make it sound like it is nothing to get 5k from someone and I think that is alot harder than most realize but I guess it weeds out the dirtbags and actually puts the seller in control of the situation. Wonder how hard that is for this to be agreed upon. Almost makes it so if they dont option to buy than it is no biggie for seller to do another one or bump rent/home value.

Kind of want to hear from someone who specailizes in these.
 

ODDSSoftware.com
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Ice, I'm here for you.

First of all;

If your the seller: Title the contract "Lease/Purchase" (Gives the owner you much more leverage)

If you are the buyer, you want it to called "Lease OPtion". This gives the buyer many exit strategies.

I couldn't think of worse place to be investing in RE right now than MI. I'm in Florida right now performing foreclosure "short sales" like there is no tommorow.

We still looking at a MI bash?
 

WVU

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The advantage to leasing with an option to buy is you can negotiate the sale price at the lease's beginning market. By the time you decide to buy the market can change dramatically and you will still be getting the negotiated price of when you signed the lease. You will not see these options very often in markets that have been gaining significant amounts year to year for just that reason.
 

Their undisputed masterpiece is "Hip to be Square.
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Had a buddy get hosed on a lease to buy deal. Of course it was towards the end of the lease as well...so I would advise that there are many loopholes and you are basically at the discretion of the seller-which might be a good thing later this year.
 

Rx Wizard
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Ice, I'm here for you.

First of all;

If your the seller: Title the contract "Lease/Purchase" (Gives the owner you much more leverage)

If you are the buyer, you want it to called "Lease OPtion". This gives the buyer many exit strategies.

I couldn't think of worse place to be investing in RE right now than MI. I'm in Florida right now performing foreclosure "short sales" like there is no tommorow.

We still looking at a MI bash?

I know Michigan is a bad economy but some of the prices here are pretty decent combined with some very frustated sellers. It is a true buyers market. We never had the HUGE appreciaiton thing hit us like the rest of the country so prices are not out of whack in the slighest here.

Trying to develop a plan on how to do this, as a builder I know is throwing out a pretty good deal to me with houses he gets on trade up (selling their house to him wholesale for a new build), weird program but looks pretty good from an investors sake. Now I need tofigure out an exit strategy.
 

ODDSSoftware.com
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I met a guy down here where all he does is negotiate .60-.70 on the dollar discounts on new homes (builders need to get off their books). It sounds like a good deal, right? Buying a house 40% off market value...how could you lose?

Here's how; The 40% off purchase price is discounted off the over-inflated original top off the market price. The rest of the market is 20% lower....net result is actually a 20% value. Still to high for the average renter. You are stuck with a new house with no market to afford the rent. No appreciation in sight.
 

Rx Wizard
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I met a guy down here where all he does is negotiate .60-.70 on the dollar discounts on new homes (builders need to get off their books). It sounds like a good deal, right? Buying a house 40% off market value...how could you lose?

Here's how; The 40% off purchase price is discounted off the over-inflated original top off the market price. The rest of the market is 20% lower....net result is actually a 20% value. Still to high for the average renter. You are stuck with a new house with no market to afford the rent. No appreciation in sight.


I understand but my setup is buying older homes for 10-20% off retail price so builder can put them in a newer home. The program is setup with a renter into my 100k or so older home.
 

Rx. Senior
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Read an article today on unemployment and saw that Michigan was tops in the nation in unemployment rate, blowing by even those "poor Southern" states.

I guess this could be both an opportunity or a negative depending on how you look at it.

Damn Ice, the number of books you read and threads you start is amazing. I sure with I had the time you had and the thirst for knowledge you have.
 

Rx Wizard
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Read an article today on unemployment and saw that Michigan was tops in the nation in unemployment rate, blowing by even those "poor Southern" states.

I guess this could be both an opportunity or a negative depending on how you look at it.

Damn Ice, the number of books you read and threads you start is amazing. I sure with I had the time you had and the thirst for knowledge you have.


Thanks, I think:lol: . Just at a crossroads in life. Have always talked about investing in RE but never have did it, may just jump in with a decent plan. Sick of talking about it and may just do it. May have walked into something pretty good with this opurtunity I am looking into. Looking for few challenges in life and this seems like something up my alley.
 
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This was on the main page of Yahoo this morning:

Houses cheaper than cars in Detroit


DETROIT (Reuters) - With bidding stalled on some of the least desirable residences in Detroit's collapsing housing market, even the fast-talking auctioneer was feeling the stress. <SCRIPT language=javascript>if(window.yzq_d==null)window.yzq_d=new Object();window.yzq_d['ndfmLULEYpA-']='&U=13bfc6so7%2fN%3dndfmLULEYpA-%2fC%3d583707.10424634.11064283.1414694%2fD%3dLREC%2fB%3d4476966';</SCRIPT><NOSCRIPT>
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"Folks, the ground underneath the house goes with it. You do know that, right?" he offered.
After selling house after house in the Motor City for less than the $29,000 it costs to buy the average new car, the auctioneer tried a new line: "The lumber in the house is worth more than that!"
As Detroit reels from job losses in the U.S. auto industry, the depressed city has emerged as a boomtown in one area: foreclosed property.
It also stands as a case study in the economic pain from a housing bust as analysts consider whether a developing crisis in mortgages to high-risk borrowers will trigger a slowdown in the broader U.S. economy.
The rising cost of mortgage financing for Detroit borrowers with weak credit has added to the downdraft from a slumping local economy to send home values plunging faster than many investors anticipated a few months ago.
At a weekend sale of about 300 Detroit-area houses by Texas-based auction firm Hudson & Marshall, the mood was marked more by fear than greed.
"These people are investors and they know the difficulty of finding financing. They know the difficulty of finding good tenants. They're cautious," said realtor Stanley Wegrzynowicz, who attended the auction.
HOW LOW IS LOW?
The city, which has lost more than half its population in the past 30 years and struggled with rising crime, failing schools and other social problems, largely missed out on the housing boom that swept much of the country in recent years.
Prices have gained less than 2 percent per year in the five years since 2001, when the auto industry entered a renewed slump.
Steve Izairi, 32, who re-financed his own house in suburban Dearborn and sold his restaurant to begin buying rental properties in Detroit two years, was concerned that houses he thought were bargains at $70,000 two years ago were now selling for just $35,000.
At least 16 Detroit houses up for sale on Sunday sold for $30,000 or less.
A boarded-up bungalow on the city's west side brought $1,300. A four-bedroom house near the original Motown recording studio sold for $7,000.
"You can't buy a used car for that," said Izairi. "It's a gamble, and you have to wonder how low it's going to get."
Detroit, where unemployment runs near 14 percent and a third of the population lives in poverty, leads the nation in new foreclosure filings, according to tracking service RealtyTrac.
With large swaths of the city now abandoned, banks are reclaiming and reselling Detroit homes from buyers who can no longer afford payments at seven times the national rate.

Michigan was the only state to see home prices fall in 2006. The national average price rose almost 6 percent but prices slipped 0.4 percent here, according to a federal study.
The state's jobless rate of 7.1 percent in January was also the second highest in the nation, behind only Mississippi.
HOW MUCH CAN YOU BUY FOR $1 MILLION?
Mayor Kwame Kilpatrick was greeted with applause when he announced last week that two condominiums in the city's revitalizing downtown sold for over $1 million each.
But investors, including some from out of state, proved far more cautious at Sunday's auction.
In the most spirited bidding of the day, a sprawling, four-bedroom mansion from Detroit's boom days with an ornate stone entrance fetched just $135,000.
Dave Webb, principal at Hudson & Marshall, said Michigan had become a "heavy volume" market for his auction firm in recent years, although bigger-money deals were waiting in California, a market he said was ready for the first such auctions of repossessed property in years.
"These people that are buying have got to look at holding on for five to seven years," he said. "The key is holding power."
Even with the steep discounts on Detroit-area properties, some buyers handed over their deposits with a wince.
"I'm not sure it's congratulations," said Kirk Neal, a 55-year-old auto body shop worker who bought a ranch in the suburb of Oak Park for $34,000. "My wife is going to kill me."
Realtor Ron Walraven had a three-bedroom house in the suburb of Bloomfield Hills that had listed for $525,000 sell for just $130,000 at the auction. "Once we've seen the last person leave Michigan, then I think we'll be able to say we've seen the bottom," he said.
 

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