August 22, 2017
What can we do with existing tenants when we take over a property on a lease option?
The problem with existing renters is that the rent increase you can push is much smaller than with a fresh Tenant/Buyer. It is still good to offer them the deal so that they know you are selling, and so that they feel that you respect their tenancy. This hopefully helps to ensure that they will cooperate with showings until you can find a tenant/buyer. In BC, it is not possible to give a Notice to End Tenancy for owners use unless you have a solid contract of Purchase and Sale with the subjects removed. Here is an example of a recent offer to a tenant below. We tried to be fair to the tenant and did not push the payments as high as the market would allow. The rent we eventually got from the Tenant/Buyer was $2350.
Steve greetings. you may remember that we talked about the idea of you purchasing the house. I have a proposal that may be interesting for you. This would effectively make you the owner of the home and any improvements you make would come back to you as increased equity in the home. Here is the idea:
1) We agree on a purchase price for completion within 2 years of $448,800.
2) $10,000 deposit up front is required.
3) You make payments of $1588 per month for the 2 years. This is just 388/month more than your current rent and we will credit you $200 of each monthly payment towards the completion so you are effectively only paying $188 /month more than your current rent and you own the house. You have the security of a long term property.
The improvements you make in the house go into your pocket and make it easier to get the bank financing down the road. If the value of the property is not $448,800 at the time of completion, we will extend until the value of the house is at that price.
Please consider and let me know. I can send the documents for your review right away.