i want to put a succesfull rent to own program out in my town and i wanted to get some advice from someone. i was thinking that i want to find my buyers first and find out what they can afford and makes sure they have at least 5% down for option money, once they are qualified i will let them pick out the house of their choice that they can afford and im going to make sure i make at least 150$ cash flow per month. these seems like a good safe way for me right? what would be the best way to find these kinds of people, what kind of marketing should i do?
Prospective tenant/buyers are a dime a dozen. Serious, qualified ones are a whole different species. Place a dummy ad in the paper for a typical, median priced home in your area:
RENT TO OWN! 50% rent credit!!
Low down, no banks needed.
3/2/2, 2000sf. Only $1,500/mo,
$179K. (123)456-7890
Believe me, that ad will get the phone ringing. Then you’ll need to go through the callers to weed out the curious from the serious.
Don’t waste your time gathering buyers before you have houses. As AJ pointed out a simple ad or my preferences–tons of signs–will pull in piles of wanna-be T/Bs. In my experience it’s very difficult to get a prospective T/B to make any sort of committment until you have a house ready for them. If you give them too many choices (i.e. pick the home of your dreams) most people will never get around to it.
T/Bs are typically impulsive buyers so they quickly lose interest if they don’t get the first house they come across. It’s far better to buy an average house and let it find the buyer for you.
How are you planning on buying these homes? If you’re going to buy them creatively then you’re REALLY wasting your time looking for buyers first since chances are the seller isn’t interested in selling creatively.
If you have cash/credit to buy the houses yourself then just go out and buy a nice, comfortable, median home for a good price. You won’t have any trouble finding a tenant/buyer for it. If you’re in a buyer’s market like much of the US, then buy LOW, or put the property under contract subject to finding a suitable T/B.
By the houses first :rolleyes and you won’t have any trouble finding a tenant/buyer for it. :deal
Remember if you buy it, They will rent! :beer
Luiz