However, unlike an option to purchase, a pre-emption right can only be issued if the landlord actually decides to sell what may or may not happen during the tenant`s tenancy. The investor might have an option to buy a property for $1 million, but then he will find someone who is willing to buy the property for $1.2 million. The investor essentially reverses the option of another buyer, in the process earning $200,000, without doing anything other than signing a few papers. Once this has been done, both parties will have to declare the HDB sale price, agree on the terms and sign the OTP agreement. People who buy and sell land often take advantage of the opportunity to purchase contracts or pre-emption agreements to force the other party to sell. The two chords may seem similar, but they are actually very different. In this sense, investors will often use options to buy real, to offer time to do the site`s due diligence. Option agreements and over-engineering agreements can be positive for both the landowner and the buyer, but there are potential pitfalls that require careful navigation. If you need advice, please contact a member of our Commercial Property team. I would like to reiterate that the option to purchase contracts must be given for remuneration or money for an option agreement to be entered into by contract.

A purchase option is a legal contract between the buyer and seller of a residential property and in principle gives the buyer the exclusive right to purchase a property from a seller in the future. Here`s an example: An investor puts a one-year option to buy a property. The use of an option is a way to enter into a value sale-lease situation in which the company ends up selling the property, but then signed a lease agreement to continue operating the operation under the new owner. The owner implements an option on the property and examines in the meantime whether he can find the necessary $2.6 million (although bank loans, equity partners or others). Real estate options are also often used by small multi-family developers. In these cases, the option to purchase may have a variable scale related to the authorization process. In an option-to-buy contract, the duration of the option period must be clearly stated. There is no correct or preferred time unit, and option periods can range from months to several years.