First of all, do you know what is the meaning of the Leaseback?
Explained in a pretty easy way as the term says LEASE-BACK is a lease to the current owners ‘ sellers’ of the house that they are currently own but now are selling to the new owners ‘ the buyers’ that are acquiring the property.
In a normal scenario that would be pretty good for the buyers, since they would receive cash flow while they wait for the termination of the lease.
Unfortunately, in the current market this is not the perfect picture for the buyers because:
1-Buyer needs to resolve their housing situation.
2-Sellers are asking for 1-2-3 or more months
3- Sellers are asking for a “Courtesy” leaseback, which means no cash flow for the buyer (new owner)
On top of that Sellers are requesting in the majority of the cases a fast closing, leaving the buyers, with the expenses of the closing costs, the rent on their current house or apartment, and not money from the lease-back.
On top of the above buyer who is now the landlord has the risk of having to proceed with a legal solution if the tenant (seller ) failed to the term of leaving the property after the lease is over,(Eviction process) causing another loss of money and adding more time to the already wait for occupying their new house.
So in conclusion before offering a leaseback as part of the offer, think well about the downside of this, not every case is the same but it is always a good idea to have knowledge of the cons and pros of anything that is in writing.
As a Real Estate Professional, I like to talk to my clients about every single detail and let them make their decisions based on facts and not just out of their urgent necessity of getting a new place to live.
CHECK THIS SHORT VIDEO THAT I HAVE MADE ABOUT LEASE-BACK
