Once the home is purchased and you are renting from the company, you will have the right to purchase the home at anytime during the next five years. While your lease is renewed each year, you are guaranteed the right to renew it for five years. Each year during the lease, your rent will increase by no more that 3.75%. For example, if the Monthly Rent for Year 1 is $2,000 per month, the increase for the next year is $75/month (ie, $2,000 x 1.0375).

Of course, the whole point to this program is you having the right to purchase the home any time during the five year lease. Each year, the Purchase Right Price increases by 5% (ie, Prior Year Purchase Right Price x 1.05). In the example, if the Total Cost Basis of the home is $200,000, then the Purchase Right Price for Years 1-5 is as follows:

  • Year 1 …………………………. $210,000
  • Year 2 …………………………. $220,500
  • Year 3 …………………………. $231,525
  • Year 4 …………………………. $243,100
  • Year 5 …………………………. $255,255

A 5% increase in price can sound like a lot until you factor the growth of the Sarasota/Manatee area. As of March 2017, the median selling price of a home has grown over 11% YTD over 2016 in Sarasota according to the Realtor Association of Sarasota and Manatee (See links below). If this growth holds true over the course of the max of five years, you stand to purchase a home with a significant amount of built in equity. Of course, past market performance should not be used as a guarantee of future market performance. As such, please do not use this information as a determining factor in your decision to move forward with the program.

There are additional costs that you will incur if they exercise the Purchase Right such as closing costs to purchase the home, including transfer taxes, attorneys’ fees, title insurance, etc. Therefore, actual total costs to exercise the Purchase Right will vary.

SARASOTA STATISTICS

MANATEE STATISTICS