# Entrepreneur of the Week - Post No. 5 - Meirav Regev-Weisblotboo A moment we will talk about single rentals and
* In this post I will refer to options that do not relate to the purchase price and / or entry into a more dangerous area, nor on airbnb - I am sure that there are experts greater than me in this field
Which is to actually get a renter but give him an option to buy the property after a specified period.
- First of all - get for the option nonrefundable option consideration fee that reduces us the amount we invested in the property, returns a few thousand to our pocket. Whether the tenant exercises the option at the end of the defined period or not - it remains with us
- On a regular basis - you can increase the rent and give rent credit, which is an amount that the tenant pays us every month and if he exercises the purchase option - the amount accrued up to that period has decreased from the purchase amount.
For example: if we gave $ 50 rent credit and the period is two years - we will receive another $ 50 each month, and after two years you can rent at the time of purchase a discount of $ 50 * 24 (number of months) = $ 1,200. It is a relatively small amount to deduct from the price of the house but the monthly supplement improves the return on the money - Another thing that raises the return on this option - the existing tenant enters with the intention of purchasing the property, his commitment to maintaining the property is higher and the chance that it will not be replaced during this period is higher, and a clause can be included in the contract. (If there are substantial repairs - it is on us that the house is still ours).
- Of course you must accompany a local lawyer with experience in this type of transaction in order to accompany you in the contract and process. Also - recommend checking the local law regarding the meaning of eviction of tenants, how much the rent can be raised, whether it is allowed to give rent credit and since each area has its own laws, some areas will be tilted in favor of tenants and others in favor of property owners.
- Insurance companies - Insurance companies often have to provide property owners with a replacement property until the original property returns to a usable condition (for example: fire). The short-term option is a hotel, so they often look for homes in the desired area and finance the rent, it turns out to be much more lucrative.
guess what? - The money comes in on time - Bonus! - I did not come across it myself, but the property I checked with my investors turned out to have an option for previous owners to rent to a nearby school - were willing to pay more than the market rentals (I think they wanted reinforcement classes or something like that). Nice idea if the property is near businesses that might be relevant to them
- I won't go into depth but must mention this: section 8 .. not just for the hard areas. I now have a time-lapse flip and I sold it to Rental until we decided to return it to the market. The neighborhood is great, and Property 8 is willing to pay $ 3000 rent on the property and give us a month-long rental bonus that we agreed to house in such an area of Property 8 (Chicago wants to remove Property 8 from the hard neighborhoods and encourage renting in the better areas).
- Taking extra rent for animals
- rooming - as they do in Israel - renting rooms separately (Issi Alon Champion of it)
- And of course - on the part of reducing investment - a careful examination of the scope of the renovation - does not go into it too much because it is a topic in itself, but check what really to renovate and what is not required, at least not right now, and cost versus benefit. Sometimes there is a tendency to renovate something cosmetic that the tenants would not even ask for. I have a property manager who is also an investor in her own right who once gave me a tip - she does a tour of the house with the tenants, and writes down what they ask about it if it is fixed - and corrects it. The rest is not (if of course it is not a hazard that must be repaired).
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???????? Very interesting. thanks for sharing! Nadav Waissman
Excellent post ?? Thanks
It is great fun to read your posts, you have written precisely and precisely in detail ..
Thanks for the compliment
Thanks for the excellent post
And thank you for who you are
Vadim Lichtik I hope you learn something from her….