For many buyers, an attractive lease may be more attractive than any promotion. However, a “lease sale” is not a pie that falls from the sky and could fall into a seller's trap if the investment is not careful。
A commercial apartment located in the gold section of the city of jilin, which recently introduced a “two-year lease”, was admired by investors. “lease sale” means the purchase of property by the client while the property has been rented and the first rent is paid to the client. In general, the lease period varies from one to two years, with rent returns ranging from 5 to 10 per cent. The “lease sale” of the commercial flat in changchun means that, at the time of purchase, the owner would receive a two-year rent equivalent to 20 per cent of the total house price, which could be used to offset the down payment, thus reducing the investment pressure on the owner。
A commercial apartment located in the gold section of the city of jilin, which recently introduced a “two-year lease”, was admired by investors. “as opposed to `sale-release', `lease-sale' is a very different way of investing, and the sales manager of changchun's commercial apartment stated that the return on `sale-release' is largely calculated in the desired state, and that the developer is ultimately unable to deliver on the promise. “lease-taking” benefits the purchaser and makes it easier for investors to adapt to the investment market。
According to the manager, many shops, hotel apartments and investment-type houses in the changchun building market had previously used “sale-back lease” as a selling point and offered an annual return of between 8 and 10 per cent, but it was rarely realized and some developers had gone after selling the house, leaving investors alone to take on market risks. “lease sale” is the form of sale in which investors bear the investment risk together with developers. The maturity of the property requires a certain amount of time, that is, the stage of what is known as the “dilemma” in the industry, which is the most painful period for investors, after which the return of investors will not be a problem. Thus, developers spend two years working with investors through the “scaling” phase。
In addition, the most important distinction between “leased sale” and “sale-back lease” is to see whether the building is an existing building. It must be “a rental sale” where the property is in obvious condition and is not subject to limitation. For the most part, “sale-to-rental” is terminologies, with investors making “ground-to-air” investments that increase the intangible investment risk。
Although the term “leased sale” is fundamentally different from “released lease”, the term “leased sale” is not a pie falling from the sky, but may also be a trap. An investor had seen a flat with general conditions and a somewhat high price, but because it was accompanied by a two-year lease at an annual rent of $15,000, the investor had entered into a contract with the seller because he felt he could earn money. While he was happy to be prepared to enjoy the high earnings, the seller suddenly told him that the tenant had unilaterally destroyed the contract two days before the transfer of the house between the seller and the buyer and had withdrawn the rent earlier, and that he had eventually purchased the unleased house at a high price。
Liu honghian, sales manager at a real estate company in changchun, said that risk avoidance and reasonable investment depended first on the strength of the developers. If the developer has no strength, even if the lease is signed into the purchase contract and registered with the land office, the developer will not be able to reimburse the buyer for the loss. Second, priority should be given to the future viability and appreciation of the building. In order to invest in international apartments, for example, investors should assess whether the location of the building is likely to create a concentration of foreign tenants and guarantee the availability of customers after the lease expires. In addition, “software” aspects such as housing design, facilities, greening, etc., and small area property management are important grounds for preserving housing values. Third, consideration should also be given to the investment recovery period, including the amount of principal recovered after the lease date. What will happen to the house when it is restored? Rent, sell, or live? How's the market going in a few years? Buyers can consult with more experienced intermediaries or ask them to forecast the value of property in the area after several years。
In short, “leased sales” are accompanied by high risks in terms of high returns. The investment in such properties should be preceded by an analysis of the changes in the rental market and the situation of the target tenants of the properties purchased, in order to determine whether the lease with which the property was purchased was a “silver month”. In addition, before entering into a contract of sale, due consideration should be given to the authenticity and stability of the lease, and no hasty decision should be taken simply because of the high rent and the long term of the lease. It would be preferable to include explicit provisions in the contract of sale that make the acquisition of a real lease a precondition for the purchase of a dwelling, so that a dispute can be documented in the future。
This newspaper's journalist, qiuhong zhang
