Are lease options and lease purchases happening more often in King County, Washington?

Asked by Rhonda Porter, Seattle, WA Mon Dec 22, 2008

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Diane Kawell, Agent, Federal Way, WA
Mon Dec 22, 2008
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Rhonda - This is a great question! I think people may be asking more questions about them,(because we have so many distressed homeowners and so many opportunity seekers in the market right now), but I don't think we have more happening.

I have just written an article at http://www.budurl.com/lpgq specifically on this topic. Since accuracy requires double checking, I will go to our local mls and see what actual numbers I can provide so we can watch this trend, if in fact there is one.

Bottom line, lease options & lease purchases can be solutions for sellers who do not need to actually close a sale immediately, and for buyers who may need some certain event/s to occur before they are truly ready to close a purchase. Our state legislature has come down hard on scams where unethical 'buyers' were posing as 'problem solvers' for distressed owners; the new laws require a very cautious and well documented process in this arena - especially for Realtors(c). That's another article!

I'll be interested to hear what other answers you'll receive to your question.
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Mark Despain, Agent, Seattle, WA
Fri Dec 26, 2008
I agree with Steve's comments below - I don't think see why they would be more frequent. And I think that's a hard question to answer. I did a quick search of the MLS using the agent and marketing remarks with a variety of phrases (rent to buy, lease to own, etc.) and did not get a single hit. It was a cursory search but the MLS isn't the best place to look for those figures given that it is pretty limited for rental properties anyway.

An organization like Dupre & Scott may have that sort of data. But I don't recollect ever seeing statistics for lease options.
Web Reference:  http://www.homehounds.com
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Steve McDona…, Agent, Seattle, WA
Mon Dec 22, 2008
In a time when inventory is well above levels of the past few years and prices are declining, I can't imagine that a 'lease to buy' would be either appropriate or popular unless the agreed (eventual) purchase price addressed the possibility of a future appraisal that was below current value. Even if this were a term of the agreement, it would not provide an incentive for either buyer or seller to lock up the property. The buyer can wait it out and see what market valuations bring possbily bringing more desireable properties within their price range. Similarly, a seller would have a tentative buyer but if the property doesn't appraise for the 'assigned' purchase price of today then the seller could find themselves still owning the property when the option expires and sustain a lower valuation that exceeds whatever kind of premium they received from the lease payments. What would be more likely under current market conditions is seller financing but even that comes with increased risks sellers may not want to shoulder given our current economic forecasts.
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