The real estate market has recently become quite a chaotic shuffle of homes and values in many real estate locations. The changes in the mortgage lending markets which have resulted in significant restrictions to lending guidelines have reduced the amount of potential home buyers in most markets, shifting the control of these booming real estate markets from sellers to buyers. With buyers in more control and no definitive time for complete market stabilization, many home seekers are hedging their bets on the market by choosing lease to purchase options instead of purchasing a new home.

Gone are the days of bidding wars on nearly every house that goes on the market. Prices are no longer rocketing into the stratosphere but rather in many markets that originally rose rapidly, prices are slowly but steadily declining. This market correction is bringing home prices to a more affordable and realistic level for most buyers. This correction has lured many home buyers to the home market. Some home seekers are looking to purchase a new home, while others have their sights set on lease to purchase options.

In a lease to purchase option, a potential home buyer will start by renting the prospective property. As a part of a lease to purchase agreement, the tenant will be creating a stake in the property they are renting. In most cases a set portion of the monthly rents are held by the landlord to be applied to the down payment if the renter should decide to purchase the home. In other cases, the lease to purchase agreement may establish a purchase price or a discount to the current market value that will be used as the purchase price.

In many cases, potential home buyers are utilizing a lease to purchase option to take advantage of the tremendous values associated with the lease portion, while hedging their bets that market values will decline more in coming years and allow for a lower purchase price.

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