For a seller, there is no benefit at all. You agree to a price and terms up front. At the end of the lease option, if the market has gone down, the buyer can renegotiate or walk away, if the price has gone up, you have to sell it to him if he chooses to buy it at the agreed upon lower price.

"For a seller, there is no benefit at all."

You get a tenant who is far more likely to take good care of the property, and you can often charge above market rent with a portion to be credited back as part of the down payment.

There is also option money payed at te inception of the contract.

I have done lease an option to buy contracts a couple times. One was a couple recently out of bankruptcy and a foreclosure for medical expenses that went past their insurance limits.

They rented for one year, made a number of improvements at their expense, and exercised their option despite a stagnant market. They had owned house for over 20 years and after one year in an apartment had enough for option money and a security deposit.

A second one was a couple getting started in the area that did not want anapartment.