Lease Options: A Win-Win for Sellers and Buyers with John Jackson
“To be successful, you have to have your heart in your business and your business in your heart.” -Thomas J. Watson, Chairman and CEO of IBM
In a recent episode of the REI Hacker podcast, host Benson Juarez sits down with John Jackson, the “King of Lease Options.” With over 800 lease option transactions under his belt and a best-selling book, John shares why lease options are a powerful strategy in real estate, especially during uncertain market conditions.
Since 2003, John Jackson has been a respected real estate investor and mentor, earning recognition for his expertise in lease options. Featured in various media outlets, John authored Real Estate Rock Stars, where he shares actionable strategies for investors.
Lease Options: A Win-Win for Sellers and Buyers with John Jackson
Lease options have proven to be a reliable strategy in fluctuating markets. As John points out, “The bottom line is the worse the economy, the better my real estate stuff does because with what I do with lease options, we're plan B for the sellers.”
This adaptability is especially valuable during economic downturns or when traditional sales channels fail. Lease options offer sellers a way to secure a full asking price, generate monthly cash flow, and potentially cash out within a year—without realtor commissions or fees.
Fresh Approach for Sellers
Sellers appreciate lease options for their flexibility and seller-friendly terms. Unlike traditional real estate agents, who often lock clients into exclusive contracts, John’s approach is refreshingly different. He shares, “Sellers love the fact that it's, to them, a fresh approach, a new approach, and that it's opposite of what a real estate agent might normally do... I'm like, no, I'm the opposite of an agent. I look at it as if this were my house.”
This hands-on, empathetic approach builds trust and helps sellers feel more in control of their property’s future.
Types of Lease Options and Their Benefits
John describes three primary types of lease options:
Straight Lease Option: A simple lease agreement with an option to purchase later.
Sandwich Lease Option: The investor leases from the seller and subleases to the buyer, earning income from both sides.
Assignment Lease Option: John’s favorite, where the investor packages and markets the option, then connects the seller and buyer directly.
For sellers, these options provide full asking price, upfront non-refundable payments, and steady monthly income. Buyers benefit by having time to secure financing while gaining a “trial period” before committing to a purchase.
Who Benefits Most from Lease Options?
Lease options work particularly well for self-employed buyers or individuals needing time to qualify for traditional financing. These buyers often have decent credit but require a transition period to meet lender criteria.
Marketing Lease Options
John has developed efficient strategies for marketing lease options:
Direct Mail Campaigns: He targets MLS listings that have been on the market for over 30 days with postcards and trifold brochures.
Costs: Each mailer costs between 50–86 cents.
Software: Tools like Privy streamline the process by identifying suitable MLS properties.
This approach helps him find motivated sellers while keeping costs manageable.
Virtual Real Estate and Lease Options
The rise of technology has made the lease option process even more seamless. As Benson Juarez notes, “I love seeing the virtual stuff come together. The internet makes the world smaller. And so you have people that are never seeing these properties, never meeting the buyers or the sellers face-to-face, and they're still able to put these transactions together 100 percent virtually.”
This virtual capability broadens the reach of lease options, enabling investors to close deals without physical interaction.
Challenges and Rules for Success
John faced challenges early in his career, which led him to establish key rules for lease option success:
Focus on Quality Properties: Avoid homes needing significant repairs.
Screen Buyers Carefully: Ensure their debt-to-income ratios and credit scores align with expectations.
Collect Option Fees Upfront: This reduces risk and ensures commitment.
Resources for Learning More About Lease Options
John provides a wealth of resources for those looking to explore lease options:
Websites:
LeasingToBuy.com: Features real examples of lease option deals.
LeaseOptionClasses.com: Offers educational resources and training.
Social Media: Follow John on Facebook and Instagram for insights and updates.
John Jackson’s expertise demonstrates why lease options are an essential strategy for real estate investors:
Market Resilience: Lease options thrive in soft markets, offering a “Plan B” for sellers.
Seller Flexibility: Unlike traditional agents, John’s fresh approach prioritizes the seller’s needs.
Virtual Convenience: Modern technology enables fully remote transactions.
Win-Win Outcomes: Lease options create value for both buyers and sellers, with unique advantages over conventional sales.
John’s hands-on methods and focus on creating win-win situations make lease options a practical and impactful tool for navigating today’s real estate market. Whether you’re an investor, seller, or buyer, lease options provide flexibility and solutions where traditional methods may fall short.
Learn more about lease options and how they can benefit you by visiting LeasingToBuy.com or LeaseOptionClasses.com.
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