Anyone have experience or interest in put/call options for RE?

Question

Hi all. The description of this forum includes "put/call options" as they apply to real estate investing. Yet there is very little information to be found on this topic in BP. I'd like to explore the use of options in a series of blog & discussion posts and would appreciate connecting with anyone that has had experience with real estate purchase options (note: these are not lease-purchase options for renters).

Thanks!

Alan Johnson · Answer

@Richard Sherman Account Closed  Thanks for the opportunity to clarify.  I was not referring to CDOs in my post (maybe I shouldn't have posted in the "Innovative Strategies" forum).  What I was referring to is the use of options as an alternative to wholesaling. Like a P&S, these would be individual agreements between a buyer and seller of a specific piece of property. I wrote a blog post that attempts to illustrate this, but I don't think I'm allowed to put internal links to it in discussion comments like this on BP.

Account Closed · Answer

For put/call options, do you mean exchange-listed options on exchange-listed real estate securities (REITs)?

Or do you mean real estate developers who buy call options from property owners to control the property as their development plans wind their way through local governments for approval?

I wasn't aware over-the-counter derivatives (such as CDOs) were widely available to retail investors.

Richard Sherman · Answer

@Alan Johnson I like the idea and something similar is used with timber and ag properties I think...sort of modified lease options where they don't actually control the property I do not think.

Richard Sherman · Answer

@Alan Johnson wow...only a matter of time before we get some new crazy CDO like derivatives on the market again...we learn nothing from last time..haha...Interesting idea though!