Creative Real Estate is thinking out of the box a little bit. Coming up with win-win solutions to save and make more money then traditional transactions. Here is an example of a deal we just did.
Seller had a house that was a rental for about 5 years. The house need about 20K in fix up to get it in top shape and about a month to list it with a realtor. Fixed up the house was worth about $525,000
We found a tenant buyer who wanted the house here is how the numbers worked.
Tenant buy Lease Purchased the house
Sales Price $550,000
Non refundable Option$$ $50,000
2 year lease at $3000 a month 10% rent credit
Tenant buyer too property AS-IS and is doing all the repairs and any maintenance that comes up at his cost.
Bottom line for seller:
Higher sales price $25,000 more then if the listed it
Higher monthly rent ( the were getting $2500 a month) Now are getting $3000. $500 more a month
No commission would have been at lease 5% or close to $30,000
No holding costs (would have been about $5000 to $6000 ) depending on how long it took to close
Tenant Buyer is doing all the repairs (savings of $20,000.
If the seller would have sold conventionally the would have walked away with approximately $465,000
What the will get is
$550,000 sales price
$300 a month more rent this is minus rent credit $3600 over the life of the lease
Total $88,600 more money in there pocket
THATS THINKING OUT OF THE BOX
What Is a Lease Option?
Lease options are a way to buy and sell homes without an immediate conventional mortgage. It gives buyers who can't qualify for a mortgage right now the opportunity to get into a home right away while they improve their credit and build up a down payment while living in the home.
How Does a Lease Option Work?
A lease option works like this: The buyer and seller agree to an option which gives the buyer the right to purchase the home during a set period of time. During this option period the buyer leases the home from the seller. By the end of the option the buyer must either purchase the home or forfeit their option fee. While the option is valid, the seller may not sell their home to anyone else.
For much more information give me a call 707-696-9073 I answer my phone!!!
Email markrichardsonlp@gmail.com
