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Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

       My friend paid a farmer $10K for a one-year option to purchase a parcel of land at an interchange where Interstate 10 crosses US Highway 90.  Friend had one year to pay the farmer $400K for the property; if he didn't buy it, he forfeited the $10K. 

      My friend exercised the option and sold the property to a hotel chain for $900K.  He pocketed $500,000 at the simultaneous closing.

Oct 04, 2018 03:20 PM
Rainmaker
4,100,105
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

I have no experience with clients using an option in a real estate transaction. 

Oct 04, 2018 02:45 PM
Ambassador
3,056,557
Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate

I wish you all the best with your real estate studies and in your real estate career. 

Oct 04, 2018 04:38 PM
Rainmaker
1,899,932
Bob "RealMan" Timm
Ward County Notary Services - Minot, ND
Owner of Ward Co Notary Services retired RE Broker

Fred Griffin gave you a great example and there are many, many more.

Oct 04, 2018 04:33 PM
Ambassador
4,580,145
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

They are not something I have experience with. I would do some more research besides asking here!

Oct 04, 2018 03:55 PM
Rainmaker
542,909
Greg Large
ERA Real Solutions - Grove City, OH
A Tradition of Trust

too many undefined variables to answer, options may be used to the advantage of one or both.

Oct 04, 2018 03:21 PM
Rainmaker
1,596,606
Valeria Mola
SIB Realty - Miami, Sunny Isles Beach - Sunny Isles Beach, FL
305-607-0709 SIB Realty Condos for Sale and Rent

You see, Daniel, so many responds and transactions were very successful

Oct 04, 2018 05:19 PM
Rainmaker
2,062,534
Evelina Tsigelnitskaya
SIB Realty - Sunny Isles Beach, FL
www.SIBRealty.org 305-931-6931

I have not done it, but as you see here, Daniel, some agents have a great experience with that kind transaction.

Oct 04, 2018 04:41 PM
Rainmaker
563,429
Maria Sapio
Keller Williams of Central PA - Carlisle, PA
Real Estate Agent- Carlisle, PA. Mariasapio.com

I have no experience with a client using an option in a transaction.

Oct 04, 2018 04:21 PM
Rainmaker
1,707,423
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

I don't do them.

Oct 04, 2018 03:24 PM
Rainmaker
556,758
Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

Options typically give buyers a place to rent with an option to purhase in the future. Seller gets a renter and buyer a place to stay. If the real estate market goes up, the buyer can exercise the option and have instant equity. In all the years I have been involved with real estate, only once have I ever had a residential option result in a closing - and that was between family members. As agents it is really tricky as to when you get paid.  May do a lot of work for no money if the option isn't exercised and you have a closing.

Oct 04, 2018 03:06 PM
Rainmaker
5,588,321
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Daniel,

Just because your instructor ask you to ask us questions, you would be better served in researching this yourself.  A

Oct 04, 2018 02:31 PM
Ambassador
4,258,081
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
The right Charlotte REALTOR!

As long as both parties agree, options can be win-wins! Good luck with your studies, Daniel!

Oct 04, 2018 09:57 PM
Rainmaker
1,922,214
Anthony Acosta - ALLATLANTACONDOS.COM
Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

I don't use options. 

Oct 04, 2018 08:34 PM
Rainmaker
4,118,298
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

I don't deal in options vis-a-vis real estate. And why does your instructor think this is an important issue/question? I've been licensed in several states and the subject of options has never been raised in my real estate classes... and I've done more than okay for 25 years in this profession without dealing with options.

Oct 04, 2018 10:13 PM
Rainmaker
1,736,888
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

There are different types of options.  Generally speaking, though, they tend to be more beneficial to the buyer rather than the seller.

Oct 04, 2018 06:08 PM
Rainmaker
6,607,723
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Options are useful for situations pending zoning needs.

Oct 04, 2018 02:35 PM
Rainmaker
808,847
Kasey & John Boles
Jon Gosche Real Estate, LLC - BoiseMeridianRealEstate.com - Boise, ID
Boise & Meridian, ID Ada/Canyon/Gem/Boise Counties

Fred has a great example.

Oct 05, 2018 07:52 AM
Rainmaker
960,961
Diana Zaccaro Broker Associate
Tropical Beachside brokered by eXp - Cocoa Beach, FL
"The Accidental Blogger" Cocoa Beach, Florida

I don't handle options but they can be risky. Used properly by a skilled buyer, they work well. See Fred Griffin's example.  

Oct 04, 2018 09:47 PM
Rainmaker
3,985,875
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

It lets the buyers and sellers plan for the future

Oct 04, 2018 08:53 PM
Rainmaker
3,467,559
John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

Daniel Lloyd many great responses.

Oct 04, 2018 08:29 PM
Rainmaker
1,519,251
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

that picture.... that question....

Oct 04, 2018 08:23 PM
Rainmaker
1,153,825
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

Most is homes on the market not sold often get snatched up by other realtors.

 

Oct 04, 2018 06:38 PM
Rainmaker
1,231,599
Mary Yonkers
Alan Kells School of Real Estate/Howard Hanna Real Estate - Erie, PA
Erie/PA Real Estate Instructor

Win some, lose some.  

Oct 05, 2018 10:24 AM
Rainmaker
1,387,343
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

Can't beat Fred's answer!

Oct 05, 2018 09:42 AM
Rainer
326,422
J.R. Schloemer, CRS
Kentucky Select Properties - Louisville, KY

Read what Fred Griffin wrote. If you need more examples Google is a great resource.

Oct 05, 2018 07:27 AM
Rainmaker
883,424
Peter Mohylsky. Broker -BRIX REALTY
Miramar Beach, Florida - Santa Rosa Beach, FL
BRIX REALTY -DESTIN

Depends on the situation.  Generally heavily weighted towards the seller.

Oct 05, 2018 05:40 AM
Rainmaker
4,433,703
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

I have not been involved with it.

Oct 05, 2018 04:32 AM
Rainmaker
1,231,002
Thomas J. Nelson, REALTOR ® e-Pro CRS RCS-D Vets
Big Block Realty 858.232.8722 - La Jolla, CA
& Host of Postcards From Success Podcast

Everyone loves having choices.

Oct 04, 2018 10:07 PM
Ambassador
5,409,680
Bob Crane
Woodland Management Service / Woodland Real Estate, EXP - Stevens Point, WI
Forestland Experts! 715-204-9671

Fred has a good example for this.

Oct 04, 2018 07:21 PM
Rainmaker
5,571,923
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

I don't see any advantage to a seller in a seller's market.... 

Oct 05, 2018 07:32 AM
Rainmaker
4,799,501
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

In many ways.

Oct 05, 2018 06:44 AM
Rainmaker
4,210,570
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

They can be good and they can be bad. Timing and market  knowledge is key!

Oct 05, 2018 06:18 AM
Rainmaker
3,331,523
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

The only real advanatages to a seller are in a declining market or recession when a conventional sale is unlikely

Oct 05, 2018 05:06 AM
Rainmaker
4,044,560
Richard Weeks
Dallas, TX
REALTOR®, Broker

Depends on the option.

Oct 05, 2018 04:16 AM
Rainmaker
622,421
The Villages Realty
The Villages Realty - San Jose, CA
"Our Performance Will Move You!"

They can be great when tied in with a short term lease.

Oct 10, 2018 08:54 PM
Rainmaker
4,939,658
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Have not had experience with options.   

Oct 09, 2018 08:08 AM
Ambassador
3,986,710
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

I do not subscribe to the theory that they are advantageous to the business on either side. The cons outweigh the pros.

Oct 05, 2018 07:36 PM