I love this business!
My partner, Peter Lunsford, and I were contacted by a gentleman who'd seen our ad and wanted to quickly sell his high-end home ($400k+) located in an exclusive golf course community. A former corporate executive, he was now putting many of his resources into building a new business and no longer wanted the expenses of a 3600+ sq ft home with a pool. After seeing the house and talking with the gentleman and his wife, we made an agreement to purchase the property subject to for considerably under market value. We also found that they would like to move to a lower cost home (<$200k) in another neighborhood.
After scouring their desired neighborhood, I found owners who'd moved to a new home and had had their previous property on the market for over a year. I made a nothing down, 24-month lease option deal with those owners, and then showed our first clients the property. They loved it! We moved them into the property (we paid moving costs, plus I loaned them my 12 ft. enclosed trailer), giving them a $3,500 down payment credit as part of the deal for their original house. We've got a $200 monthly cash flow on that property, and will make at least $20k on the back end when they finance within 4 – 12 months. We've offered a 2% discount off the purchase price if they exercise their option in less than 4 months to incent them to close sooner rather than later. There were no marketing or holding costs associated with this property.
Meanwhile, even with selling at a discount, we'll net between $40k – $70k on the high-end home, after expenses and projected holding costs. We take possession on June 1 and are offering the property as an outright sale or a lease purchase. Our first payment won't be until July 1.
As a bonus, I also got a Kawai ebony 5′ baby grand piano out of the deal.
I can't say this enough: I love this business! Our clients think we are the greatest, and we're feeling pretty good, too. We have really helped out both these couples, and are making a respectable profit too.