Is it possible to short-sell individual properties like an investor would short sell stocks of google, etc.?
EXAMPLE:
I’ve been thinking about a scenario where an investor would approach a property owner and essentially bet that the property is going to depreciate in say, the next year. Win lose or draw the investor pays for the option lets say 3% of the properties current market value.
If the property appreciates during the contract period the investor can:
- Exercise their option and buy at the current market value.
- Chose not to exercise their option.
If the property fails to appreciate or depreciate during the contract period the investor can:
- Exercise their option and buy at the current market value.
- Chose not to exercise their option.
If the property depreciates during the contract period the investor can:
- Exercise their option and buy at the current market value.
- Exercise their option and place and place a lien on the subject property for the difference between the starting value and the current value.
- Chose not to exercise their option.
I’m almost positive that this is legal, but I have no idea how to make the process legally binding.
Any comments?