Open Leasing Options

A lease option is an agreement that gives a renter a choice to purchase the rented property during or at the end of the rental period. It also precludes the owner from offering the property for sale to anyone else. When the term expires, the renter must either exercise the option or forfeit it.

The owner of a rental property who is ready to give a lease with a purchase option has a lot of other advantages. The lease option agreement terms can be drawn up in such a way whereby the renter/buyer pays for a one-time option fee that you can keep if the buyer is unable to exercise the option, and you can frequently sell the property for a price over the going rate. Additionally, with a lease option, the renter / buyer often makes a greater monthly rental payment because a portion of the money goes toward the final purchase price. If the property’s present cash flows are negative, the larger monthly payments for a lease option may be more advantageous to you.

Change In Usage Increases Value

The conversion of real estate to another use isn't a new idea, but real estate entrepreneurs have increasingly practiced the concept in recent years. One of the most common has been the conversion of obsolete or eliminated neighbourhood bank branches to alternative uses. Other examples of change in use include the conversion or redevelopment of apartment rentals to for-sale housing or the modification of old historically relevant or well-located urban warehouses to residential lofts and offices.

Lot Split

This term refers to the dividing of a larger parcel of raw land into several smaller parcels. The sum total received for the individual parcels is much greater than the value of the original parcel. Another strategy is to develop or locate a residential rental property that can be split into multiple lots with each parcel containing one to four units, because apartments with four or fewer units receive more favourable financing. You can then offer these investment properties to individuals at a price significantly higher than what the entire property would go for.

Entitlements

The development entitlement process, or the land use entitlement process, is the legal process in which a real estate developer or landowner seeks to obtain government approval for their development plans. The developer must secure all required entitlements, including zoning, density, design, use, and occupancy permits before they can begin to build.

Maintain and Renovate

Things break in rentals and renovations are one way to pre-emptively address these potential issues. For example, hinges stiffen, pipe joins begin leaking, flooring becomes worn, fittings and fixtures age, and appliances break. Often the longer you leave these issues, the more expensive they become to fix. By renovating a rental you can reduce the need for ongoing maintenance, avoid those midnight callouts, and pre-emptively address potential issues before they escalate saving yourself time and money. Additionally, well-managed rental renovations will add value to the property. This will help you build equity, increasing both your cash flow and the overall capital gains in the long run.

Fresh renovations make the property more appealing allowing you to compete in competitive markets and keep your vacancy periods short. By repairing broken locks, improving outdoor lighting and adding secure gates and fencing, and also implementing security technologies, you can increase the appeal of your property to secure a tenant sooner and ensure stable, consistent rental returns. Plus, adding screening hedges and lush plants will improve the privacy of your property to increase demand for your rental property.