Posted by Craig on May 16, 2004 at 09:22:32:
I am not a realtor.
You will, of course, make more without paying 3% to a sellers realtor.
An option to consider is a limited service RE contract with a realtor just for the MLS listing. There are plenty who will do this. You pay a one-time fee ( a smallfee if you shop) just to get a listing and the realtor does nothing else for you, and doesn’t share in the profits. Of course this means that you will have to be avialble, do your own home shows, and get a lock box so that other realtors can show it while you’re not there. Even this method will regure a small percentage (less than 3% and few realtors will bother) going to the buyer’s realtor.
Lease options would be a choice, but I’d advise against it unless you have thoroughly research them. MOST L’o deals falls thorugh, the tenant buyer never closes. After a year or two of waiting, he/she leaves and you still have the proerty. And you don’t know the condition.
Secondly, if the L/O is not structured properly, you may end up with a lawsuit or be caught in a long, expensive foreclosure suit. Be careful of simply structuring a L/O through an attorney. Contrary to what some attorney’s will tell you, few attorneys actually uderstand what is needed or have acutal expreince with L/Os.
Input please on Lease option - Posted by Chris
Posted by Chris on May 15, 2004 at 21:19:41:
I live in a hot sellers market (Reno,NV). We want to move and I’m not sure if we should sell or do a L/O. Our home could sell for approx. $250k and we owe $225K (1st & 2nd mortgage). If we sold through a realtor we would end up with about a $17k profit (3% comm.). Our home has increased in value approx. 16% a year for the last 3 1/2 years. From what I know of L/O’s we could get about 12% on a 2-3 year L/O and a 3-5% down payment. This would result in a profit anywhere from $57k-$91k on the 2-3 year L/O, rather than a $17k profit from selling it out right now.
Is a L/O the way to go…or is there better stratagies?
Also, I would like to start as an investor in this market. Any suggestions on methods (L/O’s,flips, etc.) in a hot market would be appreciated.
Re: Input please on Lease option - Posted by Julie (FL)
Posted by Julie (FL) on May 17, 2004 at 18:11:58:
The way I see it is you can make $12,500 now, make your tennant/
buyer pay a premium monthly rental so you’ll have positive monthly
cash flow, and even if they don’t buy…you’ll have a house thats
apprciated in value by 16% (that’s incredible by the way). Then you can
lease option all over again, or sell outright and gain the appreciation.
Also, since your offering such an easy way for a potential buyer to get
into your house, make sure you price accordingly. Lease options can
get top market value!
There are many good websites on Lease options out there. Do a search
and you’ll find them. (I guess I’m not aloud to post the address)
Good Luck!
julie