Rent to Own Real Estate – Now is Not a Good Time

For most prospective home buyers, lease option deals are not a good option at this particular moment in history. Lease options really only have value in situations where home prices are rising so that locking in the right to buy a home at its current market price in 12 to 24 months actually has value.

These deals, also called rent-to-own and lease-option, usually require buyers to pay extra rents each month plus up-front fees of about 5% of the purchase price. The regular rent then goes in owner’s pocket (presumably to pay the mortgage), but the additional payments are used to buy down the price of the home.

With home prices most likely to be flat to down over the next year or so, there is really no good reason to pay extra for the right to buy a specific home at its current price in a year or two.

Of course, as with an real estate home buying advice, this tip certainly does not apply to every situation. To find out what’s right for your particuluarcircumstance, contact us, or use the comment link below to contact us or ask any questions you might have about rent to own real estate, and whether it’s good for you or not.