Home Buying in 32828>Question Details

Kimberly Ros…, Home Buyer in Sorrento, FL

Need a 5 year lease purchase! Offering $100,000 more plus other incentives. Aren't there any? We need ASAP!

Asked by Kimberly Rosenfeld, Sorrento, FL Fri Apr 4, 2008

We are looking for a 5 year lease purchase on a 5bd possibly 4 bd plus office home with pool under $700,000 in Avalon Park, 32828. We are offering a $100,000 price increase, we will pay all sellers closing costs, we will put an addendum in the contract that if we break the lease or do not buy the home at 5 years, we will pay a default penalty of $25,000 within 30 days of the close of 5 years. We would pay a non refundable $5,000 deposit plus first months rent, and possibly do more incentives. We need to move IMMEDIATELY. Our other purchase fell through. Are they any owners out there that will do this? We are desperate! We can't find anything? What's the problem?

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Answers

9
Promises do not work very well these days in the real estate market.
I recommend you offer much higher upfront option money and ask that it be discounted from the price in 5 years only if you buy of course.

That is the problem you are having. I am sure I can find you a property in days that would meet your need, IF you offer a higher up front option money or deposit.
carlos@orlandorentalstore.com
0 votes Thank Flag Link Sun Jul 27, 2008
Are you still looking? I have been going through the neighborhood of Avalon Park and know of a couple properties that may fit. Call me ASAP.

Paulette Korr
Five Star Realty Group LLC
407-592-6356
0 votes Thank Flag Link Thu May 15, 2008
If you're still looking, I can probably find you something. I'm not in the Avalon Park area, but have various methods of locating lease-purchases. However, I'm a bit concerned about Compass Property Development's response. They're the sort of company you should consider dealing with (I have a company that offers some of the same services in the Washington, D.C. area) if you're serious about lease-purchases.

I agree that you probably will need to provide a larger option fee. However, length of option is negotiable, and I've heard of many that go for five years or longer.

Hope that helps.
0 votes Thank Flag Link Tue May 13, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
Contact
Are you still looking .. ?
I have a bit smaller pool home available
Let me know
Dan Kruse
0 votes Thank Flag Link Tue May 13, 2008
Kimberley,
You contacted us and we provided you with at least
3 homes and 3 different scenarios, including
substantial rent credit towards purchase (up to
100% for several months), and installment pmts.

We have not heard back from you.
As we explained, on a Lease Option /Lease Purchase
agreement , the property comes OFF the market.

Therefore, there must be an incentive for seller to do so.
That is usually the upfront Option Fee.
5 years is too long to lock prices.
And even on a 3 year plan, you need to
think in terms of at least 3% upfront.

CompassPropertyDevelopment.com
0 votes Thank Flag Link Fri Apr 11, 2008
I am a real estate broker living and working in the Avalon Park community. I'm sure there is a seller here willing to negotiate with you on your terms. The capital gains issue should not be a problem in this area since many, many sellers bought when the market was very higher, and it could very well take 5 years to recoup what their investment property has lost in the past 2 years. You did not mention what amount you are willing to spend on rent each month. For a home in the $500-$700,00. price range, you are looking at $2,500. - $3,000.00 a month. In a lease-purchase contract, the deposit is NEVER refundable, and it will probably have to be more significant than $5,000. Feel free to contact me through my website if you'd like me to assist you in this real estate matter.
0 votes Thank Flag Link Thu Apr 10, 2008
Perhaps one problem is the 5 year term. If a seller does not occupy the house 2 of the last 5 years, they will have to pay capital gains taxes to the IRS. Ouch! Maybe a 3 year lease would be more attractive to some of the sellers so they can avoid the taxes.
0 votes Thank Flag Link Fri Apr 4, 2008
Hi Kimberly,

There are lease/purchase properties available, however you'll likely run into sellers wanting much more than $5000 for the initial deposit. The $25,000 you're offering if you don't purchase...most sellers willing to lease/purchase would want that up front for such a high priced home. Also, be careful, as there's no guarantee that a home would appraise for $100,000 higher than the asking price. This would possibly turn a seller off as they may view it as creating an unlikely scenario for your loan approval when the time comes.

You should definitely hire a Realtor and put them to work calling all of the listings matching your criteria to see if anyone would be open to a lease/purchase. Many aren't advertising as being willing to lease/purchase, but they may not have thought about it. It never hurts to ask. Also, if possible, offer a larger, non-refundable, deposit.

I'm working with a buyer doing the same thing right now.

Best of luck!
0 votes Thank Flag Link Fri Apr 4, 2008
Why the 5 year term for the lease purchase? You may be able to find someone that would jump on that deal. But what are someof the upfront things you are offering the sellers? Usually a sizeable deposit upfront would assure any seller in today's market to take the deal. But 5K on a 700K house isn't much. Usually at least the realty commission should be put up up front.

Why did the other purchase fall through? was it another 5 yr lease option deal or straight purchase?

Are you working with an agent to find these?
0 votes Thank Flag Link Fri Apr 4, 2008
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