Articles
SECOND HOME MARKETING IS GETTING A RENEWED SPIN
Published on Deadlinenews.com, March 1, 2008.
Elisabeth Miller-Fox, president of PrivateCommunities.com says little is known about "model sale lease backs," a spin on lease options typically found in master planned communities.
The tight market is giving this tactic a higher profile.
"In second home communities the developer builds a model home which is fully furnished and beautifully appointed. The developer sells the model home to a buyer who is not yet ready to have a second home, but will be in a few years. The developer then leases the model back from the buyer for 'X' amount of time and continues using the model to generate more sales for the community. It's a win-win for both parties," says Miller-Fox.
Bozeman, Montana's Black Bull Golf Community; Quechee, Vermont's Quechee Lakes; and Ocala, Florida's SummerGlen adult community are just a few communities offering model home lease back deals.
"This is a very different segment of the market and not well understood by the media or the average buyer. The National Association of Realtors (NAR) & HGTV have done a great job of helping people understand the general real estate market and how it works, but there has not been a good conduit for information for the second home buyer in a private, master-planned community. This is a very different animal and a different type of purchase," she added.
Home shoppers should also be on the look out for some financing flash to give savings-poor but income-rich buyers an edge. Quincy Virgilio, president elect of the Santa Clara County association, says expect to see a return to equity sharing.
The creative financing strategy includes two parties -- one who occupies the home, another, an investor, who foots the bill for the down payment.
The symbiotic relationship has flourished during past periods of buyer-seller separation in the housing market. Las Vegas-based Creative Real Estate Online publisher, J. P. Vaughan, also a trial lawyer and real estate investor says everyone can benefit from the strategy.
One person becomes a homeowner with little if any money down, the investor, with the down payment, can get a joint venture-like return on his or her money and a seller, in a slow market, could become the investor or otherwise use the technique to quickly seal a deal, says Vaughan.