Rent to buy / LO: do I need a realtor?

7 Replies

Hi there, I would like to understand the deal flow better - it seems pretty straightforward on the surface- but wanna know more details. My situation - I have a few long term rentals that are slight positive cash flow. Nothing to impress. I am considering the lease option. Here are my questions: How do you market for lease option deals? (DIY marketing) Do I need to involve a realtor and pay high fees or the deal could be done without? I am in Arizona. Does the buyer usually order inspection at the end (I expect the buyer to be educated and would recommend the inspectIon highly)? Does the buyer get a realtor when closing? How to make legal part of the lease option straightforward and cost-effective? THANKS

@Dmitriy T. You missed the John Burley training that was last month.  He is the person we learned how to do our lease options with and we use his forms which were created by his team of lawyers to be Dodd-Frank compliant. I highly suggest making sure your lease options contracts are separate and are done correctly in order to decrease liability and maximize your returns.

We market our properties by putting signs in the property or by hanging door hangers in the neighborhood. We also advertise on Zillow and Craigslist. If we don't get it rented out soon doing that then we advertise it on the MLS and we offer $500 commission for the realtor fee when a realtor brings us the buyer.

For lease option deals, I would focus on marketing to Expired MLS listings, FSBOs, and For Rent Lisitngs( Landlord could be tired of dealing with property). You don't really need to use a realtor. This is just my opinion, most realtors wouldn't want to help you with lease options. Realtors aren't huge fans of them because they don't get their usual commissions from them. I'm sure there may be a few realtor selling out there who would be willing to help you but it's like finding a hay in a needle stack. Anyways for marketing, some good ways to go about it is to place ads on Craigslist, create landing pages to drive traffic to your website, market on social media, and put up signs in your target areas. I hope this helps.

@Dmitriy T. Getting deals is as simple as calling FSBO ads and asking if they're open to a rent to own. You can also call for rent ads and ask if they're interested in selling. If you want more leads closer to home you can put hand written sticky notes on the doors of MLS listings that say: "I would like to buy your home on a rent to own. Call Dmitriy."

For selling. Craigslist ad, zillow ad, sign in the yard usually gets it done. You can also hire a leasing agent for half to one month's rent.

@ Dmitriy T.  I would be interested in discussing your 'options' for doing one or more "rent to own" lease purchase agreements with existing and future tenants and tenant buyers, particularly since you can also then 'resell' 50% (or up to 3/4, if that's your objective?) of the rentals you offer as a "lease purchase," nearing the TOP of the current "seller's market," to well vetted buyers... Feel free to contact me here (or via email, on my profile) if you'd like to discuss this further? (I'm currently living in Phoenix metro, on the East side, and specializing in lease options, subject to acquisitions, pre- foreclosures, etc.)    ATB :-)  Scott