Have you ever considered using a rent to own agreement to sell your Phoenix house? The real estate market is in a period of transition as more people are working from home, and homeschooling is on the rise. Many would-be buyers are also transitioning their credit standing to prepare for homeownership in Phoenix], as they are not yet in a position to qualify for conventional financing. You can either create this agreement as an option, where they can walk away voluntarily at the end of the term or as an agreement that would bring legal action for default. Or, you could have an option for an extension if the buyers are not quite ready to buy at the end of the original term.
Failure on the part of the buyers to gain approval for a conventional loan at the end of the two or three-year period set out in the rent-to-own agreement means that the home defaults back to you. You’ll then have the option to rent or resale the property while keeping the deposit and any extra rent fees in the agreement added to the monthly rent as credit towards the down payment.
Because you are in the driver’s seat, you can set the terms for maintenance, repairs and who pays homeowners insurance, and even the taxes in the contract terms. Read on to learn more about how to set up a rent-to-own agreement that will help sell your Phoenix house for the highest price possible
Ways to Set Up a Rent to Own Agreement to Sell Your Phoenix House
Get Your Asking Price
Sellers are taking a risk in working with buyers with less than perfect credit. You also risk home values jumping far beyond current expectations. Because you are offering a benefit that is otherwise unattainable to these buyers, you can set the asking price at the potential value the property could have in the future as your sales price now. On the other hand, you’ll come out ahead if home values drop because the sales price is predetermined. Because there is far higher demand than supply of homes available through a rent-to-own deal, providing this opportunity will help sell your Phoenix house to eager buyers for the highest price possible.
Potential Buyers
The typical younger rental pool that would typically seek temporary housing solutions is now turning its eyes towards a more permanent residence, desiring the benefits of homeownership. When sellers offer setting up a rent-to-own agreement, this opens the door to more potential buyers. These buyers understand all too well the chance that they have been provided and are highly motivated towards a successful outcome to the agreement. These factors combine to bring added value, which helps you sell your Phoenix house for the highest price possible.
Protection
While some risks are involved in working with buyers who are repairing credit, there is no need to take needless risks. Therefore, you should consider using an experienced real estate lawyer to review your rent-to-own agreement. Avoiding legal conflicts over a poorly constructed contract benefits both parties, the seller and the buyer. Ensuring both parties have legal protections and disputes will likely be avoided is helpful when you sell your Phoenix house with a rent-to-own agreement for the highest price possible.
Flexibility in Terms
One of the key advantages of a rent-to-own agreement is the flexibility it offers. As the seller, you can set the terms for maintenance, repairs, and who pays for homeowners insurance and taxes. This flexibility allows you to tailor the agreement to suit your needs and preferences, making it easier to manage the property and ensure a smooth transaction.
Marketing Your Property
To attract potential buyers, it’s important to market your property effectively. Highlight the benefits of the rent-to-own agreement and emphasize the unique features of your home. Use high-quality photos and detailed descriptions to showcase the property and create a compelling listing. Additionally, consider leveraging social media and online real estate platforms to reach a wider audience.
Screening Potential Buyers
To minimize risks, it’s crucial to screen potential buyers thoroughly. Conduct background checks and review their credit history to ensure they are financially stable and capable of fulfilling the terms of the agreement. This due diligence can help you avoid potential issues down the line and ensure a successful transaction.
Providing Incentives
Offering incentives can make your rent-to-own agreement more attractive to potential buyers. Consider providing a rent credit, where a portion of the monthly rent is applied towards the down payment. This can motivate buyers to stay committed to the agreement and work towards purchasing the property at the end of the term.
Legal Considerations
It’s essential to have a well-drafted rent-to-own agreement that clearly outlines the terms and conditions. Work with a real estate attorney to ensure the contract is legally sound and protects your interests. This can help prevent disputes and provide a clear framework for both parties to follow.
Building a Positive Relationship
Maintaining a positive relationship with your tenants can contribute to a successful rent-to-own agreement. Communicate openly and address any concerns promptly. By fostering a good rapport, you can create a cooperative environment that benefits both parties and increases the likelihood of a successful sale.
Monitoring Progress
Throughout the term of the rent-to-own agreement, it’s important to monitor the progress of the buyers. Check in periodically to ensure they are on track with their financial goals and working towards securing a conventional loan. This proactive approach can help you identify and address any potential issues early on.
Preparing for the Sale
As the end of the rent-to-own term approaches, work with the buyers to prepare for the sale. Ensure they have all the necessary documentation and support to secure a conventional loan. By providing guidance and assistance, you can help facilitate a smooth transition from renting to owning.
Oak Street Properties makes it easy! At Oak Street Properties, our process is simple and straightforward! We make it easy and fast, working with experts from every walk of the real estate industry. Our team at Oak Street Properties can help guide you through setting up a rent-to-own agreement. Our goal at Oak Street Properties is to help you sell your Phoenix house for the highest price possible. The professionals at Oak Street Properties are happy to answer any questions or concerns you may have about rent-to-own agreements with no obligation. Send us a message or call Oak Street Properties at (480) 637-5500.