Rent to own – outlook good as home sales remain dismal

Analysts tell us that residential construction remains the weakest part of the US economy and we should not expect significant improvement in the next few months. “These numbers are extremely low by historical standards,” said Patrick Newport, an American economist at IHS Global Insight. This report comes out at a time of year when home sales are expected to peak. However, while traditional home sales reports have been bleak, home market rents are rising because for many it has become the only way to buy or sell a home.

Accurate figures for such purchases are difficult to obtain as they are private leases with the option to purchase until they are registered as a home sale when the deal is completed, often 2-3 years later depending on the terms of the contract. But rates of increasing Internet searches, book and document sales, and general searches in real estate and mortgage lending show that interest is high and a lot of rents are generated from own deals.

For many home sellers who sell homes for months with little or no activity, the immediate interest from one rental to their own advertisements can be overwhelming. Today’s market is awash with above-average risk buyers whose credit problems have arisen recently due to current market and economic circumstances, but have previously been held accountable and delivered on time.

In the event of bankruptcy or foreclosure, potential buyers are unlikely to be able to qualify for a home loan for some time, and with a large increase in the number of homeowners who have moved into leases, the rental price continues to rise. The lease of their own home sets the rental price for a specific period of the lease, which gives buyers another incentive to buy.

On Wednesday June 22nd, Federal Reserve Chairman Ben Bernanke said the housing market is a strong and persistent factor damaging the economy as a whole. With the continuing grip of traditional lending and rent hikes for homeowners, it would not be surprising if the federal government at some point identified this trend as a viable way to boost home sales and perhaps offer incentives. tax breaks for these types of purchases; and increased protective rules for both buyers and sellers.

In addition, it can be beneficial for real estate agents and brokers to be willing to facilitate these types of sales, although this would defer their initial commission by 2-3 years. Often, real estate professionals provide property management services during the rental period as most property managers are real estate brokers. They may charge a prepayment for the provision of initial services; paperwork, credit and bio checks, buyer or seller attraction, etc., and if they so choose, they can manage the monthly payments for additional monthly income until the sale ends in 2-5 years.

A property lease option, if properly managed, can help get people back to work, halt the housing burden on the economy, and pay off mortgages that might otherwise be forced to buy properties. Those considering this option for themselves need to do a good job of researching the topic and be aware of any potential pitfalls to avoid, but renting your own home for sale might not only be a good option for buyers and sellers, but could potentially be a good trend. for the American economy.

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