The best time to invest in real estate was 20+ years ago. The second best time is now. If you’re young and in your 20s or 30s or 40s, in 20 years you’ll be glad you invested today. Based on my decades of experience, I know how true this is. And I know that leases with an option to purchase are the best low cost way to get started.
Another major advantage is that lease options are the least risky but highly profitable niche for investors getting started (short of being given a house). Although rent to own has been a popular way to invest in homes for several decades, it’s still unfamiliar to many people. That’s why I continue to help people understand how this works. And why I often explain how to find rent to own properties.
Finding these properties is different from finding traditionally financed sales. Almost always, the seller is motivated to immediately start generating cash flow and finalize a sale in the not too distant future. When you do find a RTO seller, you want to learn what that person's motivation is before drawing up a lease/purchase offer. When you know their motivation, you can more easily put together an enticing offer.
How to Find Rent to Own Properties That Work for You
Today’s market is beginning to lean in favor of buyers. That’s an advantage for investors that know how to find rent to own properties. As the sellers’ market slightly softens, there will be more sellers looking for a way to generate cash flow from a house that didn’t sell quickly. But that doesn’t mean the seller has given a single thought about a lease option arrangement. Very few will be advertising for this opportunity.
What you need to do is find these people and educate them about why a rent to own or lease option is a good cash flow opportunity for them. Once you have their attention, you help them further with a sandwich lease option that minimizes the work the seller has to put into the deal. In exchange for you being in the middle, you create three distinct profit points for yourself.
You want to begin by talking to local real estate agents. Although agents don’t typically specialize in how to find rent to own properties, you need this group, that is the most active in your local market, to know what you are looking for. Agents know sellers with a listing that is getting long in the tooth who need to generate cash flow from the property. Agents also talk to each other a lot. Even if the two or three you talk with don’t have any leads, they probably know other agents that have what you are looking for.
Reluctant Landlords - How to Find Rent to Own Properties
While reluctant landlords are always worth pursuing for lease options, you’ll find even more of these as the sellers’ market softens. Reluctant landlords tend to be people who have already taken action to create cash flow from a vacant property. People who take action are open to other opportunities. You offer to not only keep their rent cash flowing but to also the real possibility of selling the property. A double win for the reluctant landlord.
“For Rent” signs can be an even better opportunity for how to find rent to own properties. These can be either an experienced landlord with yet another vacant house they need to clean and find a new tenant for, or a want-to-be seller reluctantly getting into the landlord business.
Experienced landlords with vacancies have familiarity both buying and renting real estate. They consider themselves to be professionals and will be open to creative types of real estate transactions. When the house is vacant, they also have motivation to sell creatively.
Key to how to find rent to own properties is about knowing the other person’s motivation and offering a creative solution that works for both you and the seller. What’s important is that you have a thorough understanding of what you are offering and can explain it in a way that both the new and the experienced landlord easily understands.
There are Many Ways for How to Find Rent to Own Properties
Another method for how to find rent to own properties is by searching for houses in your location of interest and simply asking the seller if they are interested in participating in a rent to own agreement. Again, be sure to have a solid pitch ready to go. Also, take the time to get to know the seller on a friendly basis. You're likely going to have a relationship with him or her for a year or two.
These are only a few of the ways of how to find rent to own properties. Others include well-worded advertisements in local classified thrift newspapers, bandit signs, and of course craigslist. The sandwich lease option is the most attractive investing method I know of. You first take control of the property for a couple of hundred dollars. You then put an option buyer in place that takes on most of the homeownership responsibilities until they make the purchase and take on full ownership. The Sandwich Lease Option lets you make a big profit for a small investment.
Besides showing how to find rent to own properties, I’d enjoy showing you all of the other insider techniques I’ve developed over the years. Everything from effectively explaining the benefits to sellers to creatively writing deals that close.
Remember, the best time to invest in real estate was 20 years ago. The second best time is now.
By Wendy Patton
For more than 30 years, I've used the Sandwich Lease Option System to earn myself and my students millions of dollars. From my experience, I know there is plenty of room and opportunity in the real estate investment market for everyone wanting to participate to find profitable deals. It's because of that fact and my personal success that I share the Sandwich Lease Option System with others.
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