Real Estate Talk

Ok just sitting here bsing, and been on this board for a little bit now so I pose a question/thought.
I have been working in tulsa for awhile now but live in another city, anyways am planning on moving the family after this current school year. Heres my thought--

My current home value/appraisal in other city would net me about 4-5k after realtor fees and thats if I get a buyer that can actually get a loan, ect....

A lease/rent to own deal with 5-7k down and the payments slightly more than i pay keeps popping in my head. If someone did it and quit paying I could re-do it and get another 5k down payment.

Has anyone done the rent to own deal and how did it work out? I would think it was better than renting out, and maybe better than selling in this market---

I just bought my second home so I know credit is tight but by far no real estate expert

Thoughts?

i've got an old buddy that buys cheap homes and flips them or fixes em up and rents them. he has said in the past that he has made good money off people who want to rent to own and fork over alot of cash down and none ever made it past year 5 and he just rents it to someone else or eventually sells it out right.

thx lk, thats what i hear aswell, seams like a pretty sweat deal, still researching the disadvantages tho, and would be good to help a family with bad credit if they wanted to start doing right, its a nice home
im rambling just dont know what to do, haha

The real estate market in Toronto is in an absolute frenzy, I just moved here, bought a small house which cost a fortune, and now I am having major buyers remorse.

SportSavant said:

The real estate market in Toronto is in an absolute frenzy, I just moved here, bought a small house which cost a fortune, and now I am having major buyers remorse.

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You will have a jingle mail opportunity in the near future. On many levels the Canadian housing market boom has been far more unrealistic than the U.S....Ditto Austrailia.

whats a jingle mail opportunity

Vaulted Treehouse said:

You will have a jingle mail opportunity in the near future. On many levels the Canadian housing market boom has been far more unrealistic than the U.S....Ditto Austrailia.

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There is no Jingle Mail in Canada - all mortgages there are recourse loans, you can't just walk away.

Vaulted Treehouse said:

You will have a jingle mail opportunity in the near future. On many levels the Canadian housing market boom has been far more unrealistic than the U.S....Ditto Austrailia.

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With the exception of the Best Coast........Vancouver.
Housing here is higher priced than it has ever been.
Olympics will only help.
A lot of factors.....best weather in Canada and that matters here.
To get our health care you have to live in Canada for 6months a year.
All the retiring boomers out buying here(so they don`t freeze) and being snowbirds for the other half a year.
Banking system is the best in the world, hence no foreclosures.
You actually need a down payment and a source of income to pay your debt obligation..........novel idea, eh.

Cusipz said:

There is no Jingle Mail in Canada - all mortgages there are recourse loans, you can't just walk away.

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Sorry to hear that.

Coaster said:

With the exception of the Best Coast........Vancouver.
Housing here is higher priced than it has ever been.
Olympics will only help.
A lot of factors.....best weather in Canada and that matters here.
To get our health care you have to live in Canada for 6months a year.
All the retiring boomers out buying here(so they don`t freeze) and being snowbirds for the other half a year.
Banking system is the best in the world, hence no foreclosures.
You actually need a down payment and a source of income to pay your debt obligation..........novel idea, eh.

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What exception, the most overpriced part of Canada is Vancouver. It will fair worst.

Over priced is relative.
I am not saying it will rise insanley but the cenus is for slow upward movement.
Not my opinion, the number cruncher facts.
Interest rates always affect every investment as does volume.
At the moment buyers out number sellers.

Coaster said:

Over priced is relative.
I am not saying it will rise insanley but the cenus is for slow upward movement.
Not my opinion, the number cruncher facts.
Interest rates always affect every investment as does volume.
At the moment buyers out number sellers.

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http://globaleconomicanalysis.blogspot.com/2009/11/canadian-says-short-canada.html

The Vancouver Real Estate market has remained strong despite the meltdown of our neighbours to the south. Thanks to a more closely guarded banking system, Canada has been able to slide through the mess relatively unscathed. The question is: now that the Olympics games are over for Vancouver, will the much anticipated financial hangover begin?

With the current strength in the Vancouver Real Estate market matched with historically low mortgage rates to go with it, one would say "how could we possibly be headed for a meltdown"? Current inventory is low which is again sending Real Estate transactions into multiple offer situations with buyers paying $10,000, $20,000 and in some cases even $200,000 over list price. Although the latter is for a specific product in a couple of choice neighbourhoods it still has happened. The potential for a bubble is definitely there but not on a broad scale. It looks more like the micro-markets of Vancouver Real Estate that are getting too far ahead of themselves are at the most risk for a bubble.

The Vancouver condo and townhouse market has seen growth over the past year at a pace that has all the right conditions to stay sustainable. 1st-time buyers are generally the demographic in this category and are taking advantage of the low mortgage rates. With the recent changes imposed by the Canadian Government on mortgage lending, we should have a little more of a cushion against an overall bubble. The changes included that anyone seeking a mortgage with less than 20% down payment (CMHC insured) would have to meet the requirements of a 5 year fixed rate mortgage regardless of the term they were seeking. Another safeguard was to lower the amount of equity one could withdraw from their home for refinancing purposes from 95% to 90% of the appraised value. In the case of a market retraction this would give a little more cushion for those who are spending close to what their home is worth.

The $700,000+ debt left on the shoulders of the Vancouver taxpayers for the construction of the Olympic Village will hopefully be recouped over the next decade. According to recent reports, one local developer was able to cash in on $31.8 million in high end units from people visiting for the 2 week Olympic period. The village will house approximately 1100 units of mixed income households in a sustainable community of shopping, services and parks.

Although there are some challenges ahead the future still looks very bright and promising for the Vancouver Real Estate market. Some lessons have been learned that in hindsight should help the City and Country avoid the same mess the U.S. got themselves into. There will be, although, pockets of bubbles where ignorance is driving people into frenzied buying and driving prices to unsustainable levels. On a broad scale the city's real estate market will see slow growth through the remainder of 2010 with a moderate increase going into 2011.

good lease to own tenants are hard to find. most expect
to have no or little earnest money at risk, pay market rates
for rents, and have a chance to buy the home at a specified
price for a long time. you as an owner have different objectives.
you want a decent earnest money deposit and some/all of it
to be non-refundable with maybe some applied to a down payment
if the renter does buy. you want a rent that is ABOVE the market
rate and you want the purchase price to be fixed for as short
as possible (1 to 2 years IMHO, you can put escalator clauses
after some period of time or renegotiate the terms upon
expiration). basically what the tenant wants is a chance at all
of the appreciation in your home for as long as posssible for
as little as possible. if you as owner give them that you are making
a huge mistake. what the owner should want is extra cash
both upfront and monthly to compensate for willing to give
the tenant a freeroll on the appreciation.

there are 2 other terms that are important besides the money and time.
remember you as an owner want the time/price committment to
be short while the tenant would like the opportunity to buy
or not buy at a specified price forever.

first point is what price to set for the option. if the price is
at or close to the market value then the buyer should receive
no or little (10% at most) rent credit for the downpayment.
also, the term should be extremely short. 1 year at most unless a fair amount of a decent earnest money is non-creditable or not apllied to the
downpayment and the rent is above market. the second is how the lease option will be executed or terminated. this should be very clear.

i have done these in the past representing sellers only and had one
actually exrcised. they will only get exercised if the real estate
market is appreciating, if the exercise price is set low, or if the
credit on rent/initial deposit is high.

the key point is that lease options are very, very tricky.
there are MANY subtle points that influence whether it
is a good deal for the landlord or tenant. if you want
to do one, hire an expert, experienced agent to draw up
the contract. if they seem unaware of the importance
of what i have explained superficially in this post,
DO NOT HIRE THEM. also, be flexible with any potential
tenant. you can easily give them the key points that they
want if they are reasonable and make back what you have
given up to them and protect yourself by using the other terms
of the contract to your advantage. hope this helps.

good stuff niltes, thx

Last 2 houses on my street sold for above the list price. Most of southern Ontario is hot right now, the exception perhaps being condos.

It's a seller's market here.