making cash from real estate

[JustAGirl]

Hi all!
I have a few questions regarding a real estate strategy that I read about from a US website - I'm after any info that anyone can give me in regards to it's applicability here in Australia.

The basic idea is to lease a property under a lease-option agreement, then sub-let/lease to a third party for a higher weekly rent than what the property is costing the lease option holder. Is doing something along these lines in Australia legal?
My general aim in doing it would be to generate cash, rather than going down the traditional real estate investment routes.

Does anyone out there have any thoughts about this?


Cheers,
Libby

 

[geoffw]

Libby,

I can't answer specifically- but there's a lot of good information on lease options in general on http://www.creativerealestateinvesting.com.au/

There is a lease options manual available from that site (http://www.creativerealestateinvesting.com.au/attent.htm )

Sorry I can't help any more than that- but at least there is an Australian viewpoint available.

 

[Joe D]

JustAGirl

If I understand your query, this is pretty much a common occurrence.

Hotels for example, do not generally own the property, but lease it and then operate as a business subletting albeit on a shorter term.

I have also stayed in serviced apartment in Southbank (Melb) where the person I was paying for a short-term lease had actually leased several units within the same complex on an extended unfurnished basis. He had actually value-added by providing all furnishings and managing all rentals without having the liabilities of ownership.

Sounded like a great idea, but one would need to be sure of their market (ie. vacancy factors etc) and in this sense it is a straight business, not an investment. One would also need to be sure the lease allows such an arrangement.

Not sure if this is what you were asking.

Joe D

 

[JustAGirl]

Thanx guys...it's a big help to get some clarification from real people! Everything's looking up so far in regards to this strategy....but there's one more question i have - this must sound so daft - but, where do i begin to look for properties available on a lease option contract?

 

[XBenX]

just make you do all of your due diligence before you take action !!!

any property (ok if you want to be picky not every single property) is available on a lease option contract, you just need to convince the vendor to sign it

 

[Katalyst]

Hi JustaGirl

I read your question with interest.

Lease Options are being used in Australia.
They are successful with commercial and residential property.
Katalyst Property Solutions is one such company you can access to find out more.

Here is there website address: www.katalystsolutions.com.au

Hope this helps

Cheers,

Andrew

 

[Sim]

Hi Katalyst.

Rather than just post a link to your website - (which will come across as pure spam to many people) - why don't you spend some time posting here on the forum with some information that will be useful to everyone ? I'm sure you have plenty of knowledge and experience which would add value to this forum.

PS. nice website - although a couple of the links don't seem to go anywhere ("Make your property positive!" and "Landlords Benefits")

 

[Katalyst]

Lease Options

Hi Sim

Thanks for your message.
I look forward to discussion on your forum.

Please accept my apolgies for creating an incorrect perception - I only joined the forum today and still getting used to its many features. It is not my intention to SPAM anyone. I was hoping to pass on a relevant resource link I thought may help JustaGirl in the search for information on Lease Options.

If a member would like to know more I would be happy to discuss this with them.

Regards,

Andrew

 

[Sim]

Thanks Katalyst, we look forward to your continuing contributions to the forum !

 

[Lofty]

Hi

Not only are some people using this strategy in Australia, they have formed an association called the Vendor Finace (Wraps) Association. It can be found at:

http://www.financewraps.asn.au

Another resource I liked on the topic is John Burley's, "Money Secrets of the Rich" (the Australian version).

Hope this helps.

 

[Jacque]

These types of L/O's are commonly used in the US and you'll find heaps of info on John Burley's site: www.mastermindforum.com
Happy reading!