Can you advertise rent to own homes before you buy them?

I want to purchase new construction homes for cash and sell them on a rent to own contract. I would like to have a tenant buyer lined up before I purchase can I advertise and have people look at the home before I buy them?

That is a fascinating, unusual approach.

Let me slap you with a wet noodle first… Don’t ask for permission. Just do it. If somebody objects, consider the source and authority, and then apologize and ask for forgiveness afterwards, if applicable.

**I can pretty much bet that the builder will not let you put for sale signs in the yards of houses you want to flip…

**There can be deed restrictions against reselling the houses (or even renting them) for at least one, or two, years after the purchase …or until the subdivision is completely sold.

Never mind, you might take title in a trust, and sell the trust on a lease/option basis. The issue remains that the original borrower/title holder is not occupying the house…

If this is a small development, the builder ‘will’ find out, and certainly object. Builders don’t want their new developments populated with renters.

It undermines the project’s marketability and drive prices down.

You could certainly advertise the house for sale that you have a purchase contract on. Why not?

It’s just all the other issues that surround the builder’s conditions of purchase.

As an aside: A better way to flip, is to take ownership outright and then resell on a contract. That’s what I do.

BTW, ‘rent-to-own’ buyers are notorious for failing to close.

Otherwise, we’re giving a renter the right to buy our house at retail-plus, and then hoping he can qualify for a new purchase money mortgage at that higher price.

Unless this is a LONG option period, the buyer isn’t likely to get a new purchase money mortgage, or one that’s enough to pay us off in full.

That’s why we want our buyers to be in a position to ‘refinance’ the loan.

Rent-to-own is otherwise a bad, bad risk for us. And selling for retail, and we might as well find a qualified buyer who can cash us out, and move on, without babysitting a long term financing relationship.

That is, offering “ownership” rather than “renter-ship,” is a far more reliable and profitable way to finance sellers in our experience.


First - ignore advice of people who tell you just go ahead and do it.
Ignorance of the law is no defense in a court of law - and what you propose is straight out illegal UNLESS …
you have the property under contract.

Under contract gives you an entitlement to deal with the property as if you are the owner.
However if you do not proceed to acquisition or transfer the obligation by flipping to another then you can be sued by the tenants/ prospective tenants for damages - and also face fines/ or worse from regulators

I like the ‘slap you with a wet noodle’ approach, however, you might want to analyze what prompts you to ask this question in the first place. I’ve flipped hundreds of home over the years and mentored dozens of newbies…what I see behind this question is fear…fear of the unknown…will I get stuck with house payments and a contract which I cannot afford to pay on an empty house.

Well…if that is what prompts you to ask the question, can I advertise to re-sell before I acquire a home, I would say this:

  1. that is lacking integrity! Don’t think you want to build a reputation like that.
  2. fear can be overcome with doing…find the right deal, have confidence in your decision, then move forward…you might be surprised how quickly you will profit…then you will rush to contract on another property.
  3. make sure you buy at right price and terms…this is where you will derive profit.

Taking action, perhaps on a smaller deal will assist you later in larger ones. Build up to the empire you likely are dreaming of. Read 1 Samuel Chapter 17…the famous story of David and Goliath. David, as a shepherd, faced small battles with a bear and a lion which saved his sheep, which prepared him for the ultimate battle with Goliath, which save the Nation of Israel…how’s that for a road map to success!

Hope this helps.


The key thing you want to do is acquire the house as low of an acquisition cost as you can. In order to get a cheap purchase you have to have a motivated seller, most motivation comes because of the 3 D’s (Death, Disease, Divorce). New construction will not likely have these. Another thing is new construction includes materials and labor and carrying cost. After you get that paid then you have profit. The lowest you can get a new construction for is the material and labor costs. If you find a pre-owned house the costs can be paid down to zero and you can acquire the house for as low as you can get them to go. So if you want a cheap house it will not be new construction.