Rent to Own or Lease Option Strategy (“R2O”): Case Study Wall Street Firms

Home Partners of America has received $US 500 million equity investment for R2O.

Home Partners’ Acquisition’s requirements:

1)    Suburban location with strong school system

2)    Home price:  from $100,000 to $725,000

3)    Term:  within 5 years

4)    Purchase Price:  increase annually; a markup 28% from initial list price or 5.6% per annum.

5)    Lease:  increase annually or 16% from initial lease rate or 3.2% per annum

6)    Metropolitan Areas:  15 states, including California, Florida and Texas.

7)    Target Tenant/optionee:  middle-class and affluent clients who have steady jobs and an overall financial history.

Other Wall Street Firms

• New York City-based HomeLPC
  
• Premium Point Investments.

Tenant/Optionee:  Advantages and disadvantages

For tenant/optionee, they are paying a premium over renting and buying a typical home.  These homes are in better neighborhoods with better school districts than most single family rental properties.

Alternative for saving more money:  Tenant/Optionee can seek for:

1)    For sale by owner with cosmetic fixer property.

2)    Negotiate a fixed lease and lock in the purchase price within 5 years.

3)    For sale from HUD home

Small Operator/Beginner of Real Estate Investor

For small operator/beginner in rental investor:  Emulate Home Partner’s acquisition requirements.  You can begin with one property at the average home price in your area.

For further discussion, please sign-up our free 30-min confidential consultation.

Related Resources at Amazon Corner

1)    Retire Rich with Rentals: How to Enjoy Ongoing Cash Flow From Real Estate

2)    Passive Income Assets: Building A Simple Passive Income From Real Estate Investing (Passive Income For Beginners)

3)    Rent to Own Essential Guide for Homebuyers

4)    Move in Now Buy Later: How You Can Have a New Home Without Perfect Credit or Tons of Cash

5)    The 7-Step Lease Option Refinance Strategy

6)    How to Buy Real Estate Without a Down Payment in Any Market

Reference

Reference:  Rent-to-own-homes-make-a-comeback

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