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Lease-Purchase is a strategy that brings top dollars even in
competitive real estate markets says Miami Realtor, Izzy
Buholzer
(PR Web,
Miami) In South Florida and most other places in the U.S. the
supply of homes and condominiums exceeds demand and subsequently
prices are starting to decline. However, “even in declining
markets it is possible to invest in real estate and realize a
good profit on your investment, or to sell your own home and get
an above-market price for it,” says Miami Realtor, Izzy Buholzer.
Buholzer,
whose firm Home & Business Realty, Inc. specializes in
residential and investment real estate in Miami and South
Florida said that , “One of the ‘secrets’ of making money in
declining markets is to utilize a ‘lease with option to buy’
strategy.”
He explained
that a lease-purchase is advantageous to property owners as well
as buyers for a variety of reasons.
According to
Buholzer, lease-purchase properties are more attractive than
ordinary rentals.
“Many people
want to own their own house or apartment but are just not ready
to do it immediately. If you offer your property as a
‘lease-purchase’ or ‘rent to buy’ then you will get more
responses to your advertisements, and will be able to get a good
tenant more quickly,” he continued.
Another
advantage in lease-purchase arrangements is that it attracts
more “responsible” tenants, which leads to lower maintenance
costs.
“People who
have entered into a lease purchase arrangement will treat the
house or apartment as their ‘own’ because they have a good hope
of owning it outright in the near future,” Buholzer explained.
However, it
is not only lower costs that make the lease-purchase attractive
for property owners. The cash-flow for the owner is greater when
there is a lease-purchase arrangement in place.
“The reason
for this is that in addition to collecting the rent a portion of
the option fee will be payable each month,” Buholzer said.
The option
fee is the amount that the tenant pays in order to reserve the
right to purchase the property at a future date.
In addition
to lower maintenance costs, the property can be sold up to 15%
above the prevailing market price. Buholzer explained that “you
can getter a higher amount for the property because the people
who are renting from you would not be able to otherwise buy a
house are willing to pay a bit more in order to get a chance to
buy a property that is attractive to them.”
To illustrate
the point of why there are now declining real estate markets,
Buholzer pointed out that “in the Miami area over the last four
years an estimated 40 % of new homes were bought by investors
and speculators. Inventory (homes on the market) has tripled in
the last twelve months while sales have dropped to less than 8 %
per month. On top of that, in the last three years 10 times more
condos were being built/approved than in the entire previous ten
years. That’s 70,000 vs. 7,000.”
Buholzer said
that despite this seeming oversupply of housing or “declining
market,” investors and careful homeowners have been able to get
a good return on their investments by using the lease purchase
strategy.
For more
information visit Mr. Buholzer’s website
www.IBMIAMI.COM or
go directly to "Facts and
Trends" to see how your area is affected.
PRWEB.com - Press Release July, 2006
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