Commercial Property - How to Earn With Options
By using options you can tie-up a piece of property with a huge momentary gains and little risk.
For an example let's say you find out at the zoning and planning office in your county about some future plans.
You find there's a new airport springing up ten miles east of town nine years out in your county.
These options are used when there's mixed values of properties.
Not in the normal cycles of real estate like what were seeing now.
It's a corn field right now but you approach a land owner with your offer.
The land is worth $150,000 now but you make him an offer.
He's ecstatic at a $220,000 with an option to buy it at some time between now and fourteen months.
You offer $3,000 to exercise the option to buy at a pre-set price.
Ask him to sign a contract giving you (or anyone you assign the contract to).
The $3,000 dollars can be applied to the purchase price if you write it into the form.
You can even offer him a little more than the agreed amount.
This just makes him happy about your whole offer.
If you back out you lose your $3,000 dollars.
Of course you've done your homework even further and find out there's some apartment buildings in the same vicinity going up plus other commercial food chains going to be there as well from developer's you run across in your network of contacts.
Meanwhile you begin to find a buyer who will pay more for the property and you make your money on the difference.
The difference is to subtract from the selling price from the buyer.
You go to work making up a plat map showing the survey; and develop a marketing plan.
Wikipedia: A plat (American) or a plan (Canadian) consists of a map drawn to scale, showing the divisions of a piece of land.
U S General Land Office surveyors drafted township plats of Public Lands Survey to show the distance and bearing between section corners, sometimes including topographic or vegetation information.
You tell the land owner you need this time line in order to find proper financing and a buyer.
He doesn't care because he's got your $3,000 dollars and knows your going to just lose your money.
The farmer also, doesn't care because to him the land is just an extra corn field to him.
He's got hundreds of acres of corn fields plus he's in his eighties anyway! Concurrently, after a few months go by you find a buyer for the property for $290,000 dollars.
You fill out a contract on the same day with a double closing.
In other words you buy the property for $220,000 dollars and sell it for 290,000 dollars.
You make the difference between the to amounts minus some closing cost.
For an example let's say you find out at the zoning and planning office in your county about some future plans.
You find there's a new airport springing up ten miles east of town nine years out in your county.
These options are used when there's mixed values of properties.
Not in the normal cycles of real estate like what were seeing now.
It's a corn field right now but you approach a land owner with your offer.
The land is worth $150,000 now but you make him an offer.
He's ecstatic at a $220,000 with an option to buy it at some time between now and fourteen months.
You offer $3,000 to exercise the option to buy at a pre-set price.
Ask him to sign a contract giving you (or anyone you assign the contract to).
The $3,000 dollars can be applied to the purchase price if you write it into the form.
You can even offer him a little more than the agreed amount.
This just makes him happy about your whole offer.
If you back out you lose your $3,000 dollars.
Of course you've done your homework even further and find out there's some apartment buildings in the same vicinity going up plus other commercial food chains going to be there as well from developer's you run across in your network of contacts.
Meanwhile you begin to find a buyer who will pay more for the property and you make your money on the difference.
The difference is to subtract from the selling price from the buyer.
You go to work making up a plat map showing the survey; and develop a marketing plan.
Wikipedia: A plat (American) or a plan (Canadian) consists of a map drawn to scale, showing the divisions of a piece of land.
U S General Land Office surveyors drafted township plats of Public Lands Survey to show the distance and bearing between section corners, sometimes including topographic or vegetation information.
You tell the land owner you need this time line in order to find proper financing and a buyer.
He doesn't care because he's got your $3,000 dollars and knows your going to just lose your money.
The farmer also, doesn't care because to him the land is just an extra corn field to him.
He's got hundreds of acres of corn fields plus he's in his eighties anyway! Concurrently, after a few months go by you find a buyer for the property for $290,000 dollars.
You fill out a contract on the same day with a double closing.
In other words you buy the property for $220,000 dollars and sell it for 290,000 dollars.
You make the difference between the to amounts minus some closing cost.
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