101: How to Lease Option Rentals with Whitney Nicely
Whitney Nicely has a background in selling dump trucks but eventually transformed herself into a full-time real estate investor and broker. On this episode of the InvestFourMore Real Estate Podcast, I talk with Whitney about how she got into real estate investing with rental properties, learned how to buy many more properties with lease options, learned to flip houses, and even invested in multifamily apartments.
How did Whitney go from the dump truck business to real estate?
Whitney’s family has been in the trucking business since 1939. They expected her to take over the business, but she got tired of diesel fuel and decided she liked houses a lot better. Her family had also invested in real estate, but they were very conservative. They liked to buy rental properties with cash, and that is also how Whitney started. She and her brother bought two rentals with cash, but they were not happy with the result. She realized that, if she purchased rentals with cash, it would take decades to create the passive income she wanted.
How did Whitney start buying more houses with lease options?
Whitney is from Tennessee, where housing prices tend to be a little lower. She buys most of her houses for less than $50,000, but banks do not like to provide loans for low-value properties. Whitney learned how to reduce the amount of money she puts into a deal by using lease options, and she also learned how to get more money out of a deal.
Whitney finds a seller who is willing to lease option a house to her. She then pays a down payment for the lease option and rents to another tenant who pays her a bigger down payment and more rent. Whitney will typically get $5,000 down payments on houses that she buys for $35,000. The lease option pays her $750 in rent every month, and the tenant has the ability to buy the home from her for $60,000.
How does Whitney find her best deals on houses?
Whitney does not buy homes from the MLS but instead uses direct marketing to find motivated sellers. Whitney finds motivated sellers using Facebook, bandit signs, direct mail, and many other ways. She has coined her business Whitney Buys Houses. Whitney has bought houses for less than $5,000! While Whitney does not use the MLS to find deals, she is a broker, which saves her money when she sells homes.
How can you get in touch with Whitney?
Whitney does offer coaching programs for people looking to learn how to lease option. You can find her at WhitneyNicely.com.