REALTOR® Magazine-Daily News-Lease-Option Sale Beats No Sale at All

OFFICIAL MAGAZINE OF THE NATIONAL ASSOCIATION OF REALTORS®

Search REALTORMag...

OR FOCUS YOUR SEARCH

NEWS & COMMENTARY

Inside For Brokers

Connect

Social Networking

Follow, fan, or friend us online.

Your Magazine

Magnifying your voice and celebrating your accomplishments

CURRENT ISSUE

PAST ISSUES

Daily Real Estate News | February 5, 2007 | Lease-Option Sale Beats No Sale at All
For sellers, builders, and real estate professionals, a lease-option sale is usually better than no sale, and can work for properties in all price ranges. Lease-options can work especially well in markets with an oversupply of homes or condos for sale.

A lease-option is similar to a new-car lease, in that the renter has the choice of buying the property or not by the end of the lease term. Unlike a lease-purchase, which requires the tenant to buy the property within a year or two, a lease-option doesn't force the tenant to buy.

For both the tenant and the owner, the amount of the monthly rent credit toward the tenant-buyer's down payment is the key to a successful lease-option.

Here's a summary of other lease-option perks:

Upfront option money is smaller than typical home-purchase closing costs.
The rent credit outweighs lack of mortgage interest and property tax deductions.
The buyer can "try on" the house or condo before buying.
The option purchase price is locked in for the lease term.
The buyer can move in within a few days after signing the lease-option.