From the BiggerPockets Blog

 BiggerPockets Blog »

Jump to Forum View All

Click a category below to view different forum categories.


General Info

BiggerPockets Q&A, Site Questions, & Announcements

1525 topics, 14456 posts — Last Post 04/24/14, 05:44AM

BiggerPockets Exclusive PRO Area

117 topics, 841 posts — Last Post 04/23/14, 08:28AM

New Member Introductions

10986 topics, 86570 posts — Last Post 04/24/14, 05:32AM

Real Estate Success Stories

399 topics, 6213 posts — Last Post 04/24/14, 01:08AM

General Real Estate

General Real Estate

Buying & Selling Real Estate

5993 topics, 47218 posts — Last Post 04/24/14, 05:24AM


650 topics, 5861 posts — Last Post 04/23/14, 07:39PM

Get Foreclosure Help - Help Stop Foreclosure Forum

317 topics, 2561 posts — Last Post 04/23/14, 08:28PM

Home Owner Association (HOA) Issues & Problems Forum

238 topics, 1611 posts — Last Post 04/23/14, 04:02AM

Do it Yourself

658 topics, 6316 posts — Last Post 04/23/14, 09:50AM

Reviews & Feedback

Real Estate Deal Analysis and Advice

3709 topics, 29748 posts — Last Post 04/24/14, 05:51AM

Real Estate Guru, Book & Course Reviews and Discussions

1139 topics, 11600 posts — Last Post 04/24/14, 04:53AM

Ask About A Real Estate Company

743 topics, 7344 posts — Last Post 04/22/14, 11:25PM

Real Estate Investing

Real Estate Strategies


5637 topics, 43962 posts — Last Post 04/24/14, 05:22AM

Rehabbing and House Flipping

3353 topics, 31105 posts — Last Post 04/24/14, 05:49AM

Real Estate Development & New Home Construction

554 topics, 4694 posts — Last Post 04/22/14, 09:17PM

Innovative Strategies

705 topics, 6044 posts — Last Post 04/22/14, 04:06PM

Tax Liens, Notes, Paper, & Cash Flows Discussion

867 topics, 6693 posts — Last Post 04/24/14, 03:16AM

Rent to Own a.k.a. Lease Purchase, Lease Options

699 topics, 4942 posts — Last Post 04/24/14, 05:49AM

1031 Exchanges

143 topics, 1062 posts — Last Post 04/22/14, 03:21PM

Foreclosure Investing

General Foreclosure & Pre-Foreclosure Forums

1691 topics, 11313 posts — Last Post 04/22/14, 09:26PM

HUD, VA, and Tax Sales

416 topics, 3103 posts — Last Post 04/23/14, 02:29PM


1217 topics, 10603 posts — Last Post 04/23/14, 08:46PM

Short Sales

1539 topics, 13154 posts — Last Post 04/23/14, 08:25PM

Landlord & Tenant Forums

Landlord & Rental Property Questions

7252 topics, 71192 posts — Last Post 04/24/14, 05:46AM

Mobile Homes & Mobile Home Park Investing

639 topics, 5146 posts — Last Post 04/24/14, 05:13AM

Investor Basics

Starting Out

7733 topics, 60690 posts — Last Post 04/24/14, 05:41AM

Investor Psychology

431 topics, 6107 posts — Last Post 04/20/14, 06:04AM

General Real Estate Investing

4730 topics, 37326 posts — Last Post 04/24/14, 02:18AM

Real Estate Investor Marketing

1738 topics, 14148 posts — Last Post 04/23/14, 08:20PM

Commercial Real Estate

Commercial Real Estate Investing Forum

1413 topics, 9013 posts — Last Post 04/24/14, 12:59AM

Multi-Family and Apartment Investing

1123 topics, 9396 posts — Last Post 04/24/14, 05:24AM

The Business of Real Estate

Real Estate Technology and the Internet

Real Estate Technology, Social Media & Blogging

645 topics, 4913 posts — Last Post 04/24/14, 05:42AM

Business Basics

Goals, Business Plans & Entities

833 topics, 7585 posts — Last Post 04/23/14, 08:58PM

Real Estate Finance & Legal

Financial, Tax, and Legal

Tax, Legal Issues, Contracts, Self-Directed IRA

2802 topics, 20136 posts — Last Post 04/23/14, 06:57PM

Property Insurance

311 topics, 2057 posts — Last Post 04/23/14, 01:20PM

Personal Finance Discussion

330 topics, 2754 posts — Last Post 04/22/14, 12:06PM

Loans, Mortgages, Credit Lines

Private & Conventional Lending Discussion

2852 topics, 19848 posts — Last Post 04/24/14, 02:50AM

Creative Real Estate Financing

1221 topics, 8860 posts — Last Post 04/24/14, 02:09AM

Crowdfunding Real Estate

35 topics, 463 posts — Last Post 04/19/14, 06:24PM

Real Estate Professionals

Real Estate Professionals

Real Estate Agents

1216 topics, 8025 posts — Last Post 04/24/14, 05:37AM

Bankers, Lenders, and Mortgage Brokers

442 topics, 1931 posts — Last Post 04/23/14, 09:04PM


269 topics, 1690 posts — Last Post 04/22/14, 07:33AM

Local Real Estate

Local Real Estate

Local Real Estate Networking & Recommendations

2017 topics, 11758 posts — Last Post 04/23/14, 10:03PM

Americans & International Real Estate

162 topics, 572 posts — Last Post 04/24/14, 03:31AM

Foreigners Buying in the USA

62 topics, 409 posts — Last Post 04/10/14, 06:27AM

Canadian Real Estate

65 topics, 439 posts — Last Post 04/22/14, 09:27AM


Real Estate Marketplace

Real Estate Marketplace

15085 topics, 54135 posts — Last Post 04/24/14, 04:15AM

Real Estate Events and Happenings

168 topics, 2606 posts — Last Post 04/23/14, 10:05PM


Off Topic


2907 topics, 32446 posts — Last Post 04/24/14, 05:52AM

Housing News & Real Estate Market

920 topics, 8391 posts — Last Post 04/23/14, 02:43PM

BiggerPockets Real Estate Investing Summit

97 topics, 1752 posts — Last Post 04/23/14, 04:51AM

BiggerPockets Resources

Forums » Real Estate Deal Analysis and Advice » Sell Home To Rent Back

Sell Home To Rent Back

6 posts by 4 users



Im new to this forum and hope I'm posting in the right section.

My real estate agent listed my home on MLS in Montreal Canada for $378,000. I would like to sell the house to a property investor who will rent it back to me. My motives are to sell the home to fund a dream project of mine. My other option is to sell the house and move into a rental, but I would prefere to rent my house back, which will save me a move.

I saw comparable homes nearby renting for between $1600 and $1800 a month. Is this a reasonable rent price for me to ask for? I would sign a 1 or 2 year lease, cover utilities and grass & snow mainteneance.

My real estate agent never sold a house as a rental before. My house is listed in the MLS residential section. So far only couples and families have visited my home. I think listing it in the commercial section would attract real estate investors, but my agent thinks that since my home was never rented out, it cannot be listed as a revenue property in the commercial section. Does this make sense? Where should I market my home?

Any advice or comments are welcome here. Thanks!

SFR Investor · Wheat Ridge, Colorado

Moved to a better forum for your question.

As a potential rental property, this is not only a bad deal, its a truly awful, horrible deal. I won't say you can't find someone to buy a deal like this, but, frankly, you're looking for a complete idiot to buy your house.

I don't know exactly the terms an investor might pay in Canada for a rental, so I'll use US terms. They can't be radically different (i.e., better) or investors would be snapping up properties in Canada.

An investor would have to put about 25% down, or $95K. At 5% and 30 years, the principle and interest on the new loan would be $1522 a month. That doesn't include taxes, insurance, property management, maintenance, capital or vacancy.

A old school rule of thumb for rentals is that the monthly rent has to be at least 1% of the purchase price. In reality, that doesn't work very well, and, at your price point, 1.5% is what's needed to be profitable. Now, lots of people buy for reasons other than cash flow, such as appreciation. But the rent you're proposing is way out of line with the purchase price.

In many areas, the ratio of rent to price you're hoping for isn't unusual. Lots of properties are like this in California and New York. In these cases, people are expecting appreciation and are able to suffer the negative cash flow needed to hold the property while that's happening. Unfortunately, that was a lot easier during the bubble and is now going to be a hard, long slog.

Realistically, you should just sell your house to whoever will buy it. If you can truly rent a similar house in your same area, then find such a rental after you sell. If you limit possible buyers to ones who will rent it back to you, you're cutting your pool of prospective buyers by 99%. But if rentals similar to your house are available then you've already found the sucker who bought a house that doesn't generate enough rent to cover their payments.

Or, you may have to choose to live in a different area. Sometimes dreams require us to make choices.

Jon Holdman, Flying Phoenix LLC

· Shasta Lake, California

I'll second Jon, that's a horrible rental. There may be homes for rent similar to your home, but I'd bet they weren't bought with a rental in mind or if they were it was at a time when prices were different or the 'investor' didn't know any better. Your best bet is to tap your equity (if you have any) with a HELOC/refinance to stay or Sell and move.

I was earlier looking at this problem that places I want to live are bad investments for cashflow, but factoring in deductions and such it's still often cheaper than renting living there yourself. If the difference is less than you can make by investing in a few cheaper homes that make good rentals then it may make sense to move. If not your better off staying put. You'd have to run the numbers to see what the difference is, then decide if it's worth it to you.

Thanks Jon and Jeff for your input. It really helps me to see how others value a rental to see if my idea is any good or not.

Montreal real estate prices are still hot for now. I bought my home in 2007 for $215,000. I completely renovated it and spent $50,000 plus a lot of my labour fixing it up. So in 5 years I stand to gain close to $100,000. Some areas in or around Montreal have done even better. Some think the housing market may cool down, but so far the economy hasn't been hard hit like in the U.S. and people still have a positive outlook in Montreal.

I feel that an investor would partially buy my house for the potential property appreciation and for a trouble free property. I say trouble free because it's fully renovated, I am handy, I do the outside maintenance and have credit with the bank. Also, the investor doesn't need to look for a tennant.

That said, I see how the rental income is low and can be bad for an investor. The other houses I've seen at low rents were probably bought around 1999. My house was worth only $110,000 back then. The Mortgages are probably almost payed off or verry low on those homes and the owner may not be ready to sell it yet.

I just thought it was silly for my to move if I can save the move. On the other hand, I don't want to limit my potential buyers by 99%. I guess to follow my dream I may have to sell and move after all.

If anyone has other ideas or input, it would be great! I like learning and to see how other people think and invest. This is a great forum!


Someone suggested that I look into companies that do "rent to own" arrangements. Does anyone know how this works? Under a rent to own option, do I sell my home to a finance company that would rent it back to me? Does rent to own sound like a viable option in my situation? Thanks!

Real Estate Broker · Halifax, Nova Scotia

MLS rules in Canada state that you can only list a commercial property as commercial and it would appear on the site for commercial listings. Get your agent to put the situation in the property overview and it will weed out families looking for their own accomodations and get your agent to contact other agents and let them know about your situation so they can tell their investor clients. Best of luck!

Sign up