ok,so question ,how do you make this deal work for a lease option???
price $ 425,000
monthly payments $2800
term 2 years
realistic rent is about $1400 month
now my question is…. does the tennat buyer pay a way higher rent than market for the right to buy??? they would have alreay paided an up front option to purchase money of about 3 to 5% .and because $2800 a month would only cover the mortage i couldnt give a rent credit unless i jacked up the rent even more.the sellers happy with the deal as it stands but ive alreay rengotiated with him so this is as good as i gets.
house would definatly be worth $55,000 more in two years
this question is not only applying to this deal but others too because in Auckland most of the rents dont even cover half the mortgages,well the good areas anyway !
should i let this deal slide ??? anyone that has experience with this would great to help.
cheers
You could possibly consider offering a precentage discount on the market rate in x years time in return for higher rent now.
Terryw
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hey there,
A few questions to answer yourself
-Is the house priced below market?
– Are the sellers really motivated?
– How much cash are you putting up for option?
– Why can’t they sell in open market?
– Are you prepared to lose the option fee if you are unable to service the monthly repayments….remember that you have to create a win/win on both ends of the equation….sometimes we all forget that and the whole deal just turns to “<edited>e”……
You could always assign the option quickly if you have a really good strike price locked in on the option.
If it is not that good a deal… then I would just keep on searching…..
Like steve McKnight and Dave Bradley advocate:
1. How much in
2. For how long
3. What are the risks
4. How much returnCheers,
Kiwicheers for that.
auctually didnt have to put up any money for option.
The house was for retail and the risk was somewhat limited.
But i gave the house back, because the payments to the seller were too high and figured that theres better deals out there anyway.
probably would have trouble with that one ,also the term was only two years which is too little and on top of all that the seller wasnt super motivated,hence such a short term.but no worrys mate, i talk to about 5 people a day that ring me off my signs and adds so the first deal cant be to far away!!!
goddamit!
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