our options agreement refer to an arrangement where a property owner leases their property to a tenant with an option to purchase it at a predetermined price within a specified period. this option provides certain benefits to both the property owner and the tenant:
- flexibility: options offer flexibility to tenants who may not be ready or able to purchase a property outright. it allows them to live in the property and potentially become homeowners in the future, giving them time to improve their financial situation or save for a down payment.
- future price lock-in: with an option, the purchase price of the property is determined upfront. this can be advantageous to tenants as they can secure a future price for the property, protecting themselves from potential price increases in the real estate market.
- test the property: options provide tenants with an opportunity to experience living in the property before committing to a purchase. they can assess the neighborhood, amenities, and suitability of the property for their needs, ensuring it meets their expectations before finalizing the purchase.
- rent credits: in some cases, a portion of the rent paid by the tenant during the option period can be credited towards the purchase price. this acts as a form of savings, allowing tenants to accumulate funds for a down payment while paying rent.
- investment potential: for property owners, options offer the potential to generate rental income while also securing a future buyer for their property. it provides an alternative avenue for selling the property, potentially attracting more potential buyers who may not qualify for traditional financing.
- limited liability: as the property remains under the ownership of the property owner during the option period, they retain responsibility for major repairs and maintenance. this reduces the liability and financial burden on the tenant.
- potential sale in a slow market: options can be particularly beneficial for property owners in a slow real estate market. it allows them to secure a tenant and potential buyer while waiting for market conditions to improve, ensuring a sale at the predetermined price.
with over $2B financial backing, our options can be a win-win arrangement for both property owners and tenants. they offer flexibility, price protection, and the opportunity to test the property for tenants, while providing rental income, a potential sale, and increased marketability for property owners.