What would our $200,000 transaction look like from a return on investment perspective if we put up a 10 percent option fee of $20,000 for a 12-month option period? The return on the cash investment looks a lot better than what you are getting on your CDs, doesn’t it?
4. Control Property
The name of the game in real estate investing is control. Donald Trump controls way more real estate than he owns. When you have control of something, you are many times in a better position than when you own something. Our Quick Cash real estate investment strategy is based on controlling property, not owning it. We take this one step further by controlling property with the paperwork of buying real estate.
By using an option contract you can control lots of property without owning any of it. We will briefly mention the advantages of controlling property without owning it. You may remember them from article before. These advantages include quick cash, no land lording, no monthly mortgage payments, no property taxes, no hazard insurance, no maintenance costs, no homeowner association dues, no lawsuits, no extensive record keeping, and no income tax problems.
The advantages of controlling property with an option contract are the same as the advantages of flipping property. Except it is better with the option contract because you can flip the contract rather than flipping the property.