The exit strategy you use to sell your house can make all the difference in earning the highest possible returns on your real estate
investment. An extremely lucrative alternative to selling your house
outright, lease options offer a way for you to earn a higher return on
the sale. At the end of the agreement, typically one to three years,
they can exercise the option to buy the home or walk away, and you keep
the initial option fee that you collect upfront as a down.
Much like having tenants, you’ll be renting out your property. However, these tenants have much more at stake than the average tenants,
as they are, in essence, test-driving ownership of the property. These
tenants are willing to pay extra for the chance at living the lifestyle
of homeowners while correcting any missteps with their credit or
building savings for their downpayment on the property. With the right
tenants and a thoughtfully constructed lease option agreement, many
investors learn to appreciate this arrangement’s benefits and begin
investing with a lease option strategy in mind. So read on as we explore
using a lease option to sell your house in Belleville.
Asking Price
Because you’re in the driver’s seat, you can set the sales price for the property now when you use a lease option to sell your house in
Belleville. Often set above market to account for the appreciation
estimated to occur over the contract term, while you take the risk there
could be a sudden hike in values, the tenant takes the risk that values
drop.
Option Fee
Using a lease option to sell your house in Belleville means that you’ll collect an initial option fee ranging from one to five percent of
the sales price, though option fees of up to twenty percent are not
unheard of, and the fee is typically non-refundable. With the national
median listing price for active listings being around $450,000 as of May
2022, 5 percent would be $22,500, which would apply towards the
purchase if the tenant exercises the option.
Tenants Maintain Your Property
While you’ll still hold the title and be responsible for the taxes and insurance, everything else will fall on the shoulders of the tenant
when you’re using a lease option to sell your house in Belleville. So,
for example, tenants typically carry the financial responsibilities of
maintaining the home and even making repairs.
Above Market Rent
You’ll make above-average rental income using a lease option to sell your house in Belleville; the portion of rent paid at above-average
rental rates is called the rent premium. The buyers would then deduct
the amount paid into the rental premium over the contract term from the
sales price upon exercising the option. Of course, if there is no
purchase, you’ll also keep these funds.
Talk to one of our highly seasoned professional home buyers at Cardinal Creek Properties today about your property, with no obligation.
At Cardinal Creek Properties, we want you to know you made the best
deal and feel good about working with us long after the closing. That is
why at Cardinal Creek Properties, we’ll compare the numbers of a
traditional listing vs. the lease option method and even make you an
offer to buy your property directly, as-is, for cash. At Cardinal Creek
Properties, we’re fully transparent, providing the detail of how each
number in our calculations so you can make an educated decision about
what works best to sell your Belleville house.
Ready to learn more about the win-win advantages for sellers of using a lease option to sell your house in Belleville? Call Cardinal Creek Properties at (314) 467-8137.
