Do I share in the equity of the Home if I decide to buy the home?Last modified December 4, 2021
Yes, in one sense you can aquire some equity because the Investor only wants a comparatively modest return on thier investment. Appreciation rates year after year for these homes is many times much higher than what they agreed to sell you the proerty for. Remember, your option to purchase price is determined before the Investor purchases the property for you. If your agreed upon purchase price is lower than what the property has Appreciated, at the time you purchase the property, then you will have some instant Equity in the property! However, if you never purchase the property, you won't be able to take advantage of how much the property has appreciated since you moved in. Please understand, the past 2 years (2020 & 2021) in Florida, the Appreciation rate has been approximately 40% in combined total for those 2 years. The Investor understands that the property must still appraise at the predetermined amount you agree to, when you begin the Lease with the Option to Buy process. If/when you decide to purchase the property in years 1-5, it will depend on how much the property has appreciated versus the pre-agreed to purchase price when you moved into the property. Consequently, the predetermined purchase price schedule is very fair, if for no other reason, they want you to sucessfully purchase the property when you're ready and able. While the Investor wants you to eventually purchase the property, there is no penalty if you just rent the home without excercising your Rent to Buy option. Its your choice and theres no pressure on you to purcahse the property.