My interest in lease to own started after my recent experience of becoming a tenant buyer. I chose the property and an investor bought the property for $560k on my behalf. My purchase price is based on a 5.6% appreciation rate, which works out to be $660k in 3 years. The market where I reside is appreciating at about 10% over several years and 15% last year. So, my house could be worth $750k conservatively. The way this program is structured, I could find a buyer and profit from the difference of the sale. If buyer offers $750k, I would make $90k on the sale and still get back my initial downpayment and rental credits for a total profit of about $135k. That works out to $45k yearly passive income. So I started promoting this program and charging a fee to facilitate the deal. I now learned that I can do this myself. But, a few callers asked me if they could pool their money together with some friends and family and get a property. It got me thinking that this might be a great idea to promote sometime in the near future. The idea here is to get small groups to pool their money together to get rent to own properties and find a buyer at the end of term for profit. They split the profits and get other properties together or just go their own way. Have any of you started a real estate club using lease option purchasing as the strategy? Are you aware of anyone who has done it or doing it? Is this even a good idea? Thanks in advance
i've considered the idea of buying properties then selling them rent to own off of the MLS. Never thought to have a buyer pick the house they want ahead of time. Interesting. Can't comment on the other idea, seems the more people you have involved in a deal the more likely it is to go south.
In Ontario, Canada, a lot of the rent to own programs enable you to select the property that you desire within a certain price and an investor buys the property. The person facilitating the connection gets paid by the investor. I'm
not sure if it would go south or not if there are a lot of people involved in a rent to own purchase, but I was thinking of having 5 people maximum per deal. So, with a downpayment of $20k, it would be $4k each.
Why do you want to buy the property first? Just do a Sandwich LO.
I didn't say anything about buying property. I mentioned that the club members would pool their money together and invest in a rent to own property