Hello, Investors!!! Quick question! How do you come up with your retail value to purchase on the Lease option purchase?
I see Investor saying they will buy the home for 90% retail value or 15 to 20% discount.
Also, who comes up with the monthly lease payment between the seller and investor?
Thanks!!!
The idea is to get a good option price and also have it expire 3-5 years out. I don’t follow what investor is paying 90% retail or 15-20% discount, that seems like two different things?
You as an investor need to figure out what lease payment makes sense depending on your exit strategy. If you can’t get the amount to be what you need it to be, move on to another deal.
Ultimately the market determines retail price and lease payments. You can set your price and lease payment so that your deal makes money but if no one bites then you will have to adjust your numbers to get the deal done. That is the market forces in action. Do your research on nearby similar home prices and give it your best estimate on what those values might be like during the option period of your deal. Likewise research market rents and lease payments on option deals to determine what the market will accept.