The person that agrees to a lease option is trying to forecast future property values. If the buyer agrees to buy your property for $100,000 in two years, and it becomes worth $110,000, and you and he agreed that the option payment is going to be an extra $200 per month (24 x $200 - $4,800) then it would be smart for him to buy it at $110K because he would be buying for under market value.
If the value decline to $90,000, it would be cheaper for him to walk away (or keep renting) than to exercise the option.
You need to make a call. Obviously of the ONLY way they can afford to buy is lease option (due to perhaps credit issues), and perhaps you carry back part of the note for the downpayment, then it may make sense. But for buyers you'd have to put together the contract so it is win-win.
I agree with your perception of lenders tightening underwriting requirements. You might look into owner financing, that might be more direct and avoid the change in value problem.
Lease purchases can work, I've done tons of them (more in the past as "installment sales" but, you need to know the risks.
A lease purchase is a fantastic option. In Philadelphia, we have become the lease-purchase experts per se as we marketed a whole building as lease purchase and have it at 90 percent occupancy now. The benefit to our client is that without the lease purchase option, he would have a much greater percentage of vacancies and be under water on his debt service. Thus, you will be able to get your property occupied quickly, you will be able to charge a higher rent and position yourself that it will be sold within the lease purchase timeframe. The benefit to the buyer is that it gives them time to get their credit tight, it provides an automatic savings account that can go towards the purchase and some latitude if they like the area. It really can be a "win-win" depending on your goals.
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Cons include the fact that if you cannot obtain finanicing in the proscribed period of time, you will lose your downpayment and any money you put into the transaction. If the market declines, you're still on the hoolk to either make the purchase or walk away from your downpayment.