What is the function of a "lease option"?

A lease option serves as an agreement that allows a tenant to rent a property with the additional benefit of having the option to purchase that property at a later date. This arrangement often includes predetermined conditions under which the tenant can exercise the option to buy, typically outlining a specific timeframe and purchase price.

This option can be appealing for tenants who may not currently have the means to buy a home but wish to lock in a purchase price while they are renting. It provides them with the opportunity to assess the property and the surrounding area to ensure it meets their needs before committing to a purchase.

In contrast, the other options do not correctly describe the essence of a lease option. An exclusive listing agreement pertains to the terms under which an agent lists a property for sale, a tenant renewal option concerns extending an existing lease without purchasing the property, and strategies for enhancing tenant engagement relate to building relationships and communication but do not involve purchasing. Therefore, the correct choice succinctly encapsulates the dual nature of leasing and potential ownership within the same agreement.