As a homeowner if you are even open to the idea of selling your home, renting to tenants with an option to buy is usually a great thing, here are the pros and cons.
Benefits of Renting your house with an option to buy
Usually you are charging a higher then normal rent because a portion of their payment will go towards their down payment. For example lets say the normal rental rate is $2000 per month, you might set up something where your renter is paying $2300 to $2500 so $300-$500 per month goes towards their down payment if they exercise their option to buy it. Should they not choose to buy it however you just collected some extra rent. Another benefit is your tenants will probably treat their home better then if it was just your house, its going to be their house and they will treat it better most of the time. They are also more likely to improve the house as they plan to be purchasing it at some point in the future.
Negative effect of renting your house with an option to buy
Really the only negative is you set the price at the time the lease option is set up, so if the market it trending higher you wont participate in that additional appreciation, your renter will, assuming the exercise the option to buy.
For more information on lease options in Newport Beach please contact one of our knowledgeable realtors today.
Our family was expanding and we were looking for a bigger home for our family of five. We choose Dave to be our realtor and would not have used anyone else. What we love about Dave is that he took the time to understand our needs and what we are looking for. He only showed us homes that met our budget and needs. Once ready he listed and sold our home for over the asking price and found up the perfect home. He is knowledgeable of the market and the industry. We are so happy with the home we bought and would recommend him to anyone in the OC looking for a realtor. - Heather W