What Is a Sale-Leaseback? How EasyKnock Is Changing Homeownership

As the United States real estate market continues to evolve, traditional homeownership is undergoing its own transformation. That’s where EasyKnock, a New York City-based sale-leaseback platform, emerges as a United States-based home equity solutions platform. In a residential sale-leaseback, homeowners sell their property but continue living there as renters. This arrangement lets them access their home’s equity — while staying put.
“Rates have gone up obviously, and that’s impacted people’s ability to borrow or impacted people’s ability to move,” says Jarred Kessler, EasyKnock’s CEO. “So the increased rate environment has made people more hesitant about taking out a loan and looking for alternative solutions.”
Market-savvy homeowners recognize that home value appreciation is at record levels. These homeowners want to take advantage of this trend. “And they also want to capitalize on unprecedented appreciation in home values.
“And so, they can either do that by moving and selling the house outright — or they can do it by a product like a sale-leaseback, where you sell the home and convert that hard-earned equity while also maintaining the ability to capture future appreciation.

The EasyKnock Residential Sale-Leaseback Solution

When completed by the end of 2024, the EasyKnock platform will offer consumers alternative methods of purchasing and selling new homes. In addition, homeowners will be able to choose innovative ways to convert their home equity into cash. These non-loan programs will provide qualified homeowners with enhanced financial flexibility over time.
As with most product or service purchases, finding the right customer is crucial. EasyKnock expanded further on the company’s criteria for selecting residential sale-leaseback customers.
“It’s your average home in your  average American town. The No. 1 thing that maybe stands out a little bit is you have to have enough equity in your home for us to be able to do the transaction.”

A Residential Sale-Leaseback Solution Snapshot

Every home purchase transaction involves legal and logistical issues — and a residential sale-leaseback transaction is no different.
“We move as fast as the customer. We realized that it’s a huge financial transaction, but it’s also a hugely emotional transaction. This is your home, a place where perhaps you’ve raised a family, become part of a community. It’s a very consultative sales process. We take our time explaining to customers how it works [and] what they can expect.”
“We have various materials detailing the transaction and how it works and provide every customer with an estimate that shows them exactly one, what the economics of the transaction are. And then two, what it can mean going forward.”
To meet customers’ different financial needs, EasyKnock created two residential sale-leaseback solutions. In either case, the customer must be occupying the home as their primary residence. Besides the customer, anyone living in the house must be on the lease. Finally, EasyKnock cannot purchase currently rented homes or investment properties.
EasyKnock’s straightforward Sell & Stay solution enables a qualified homeowner to convert their home’s equity into cash. This program appeals to customers who wish to pay down their debt or navigate a life event such as divorce or prepare for retirement. A customer could also use the funds to help grow their business.
During the transaction, the customer will receive up to 75% of the home’s fair market value in cash, the remainder in the form of an Option which allows them to control the outcome and timing of the subsequent sale. After settlement, the customer will stay in the home as a renter. They will have a series of auto-renewing 12-month leases for up to five years total.
This five-year period provides the customer with sufficient time to decide on their next move. At any time, they may repurchase the home for the agreed-upon buyout cost. Conversely, the customer can ask EasyKnock to sell the residential property on the open market.
EasyKnock’s short-term MoveAbility solution helps streamline the homebuying process. This program appeals to customers who plan to move to another home within 12 months and want to sell their current home now, using the cash for their next property while avoiding the move to temporary housing.
Each MoveAbility customer signs a 12-month, nonrenewable lease while retaining rights to any appreciation. During the lease’s first nine months, the customer can direct EasyKnock to sell the property on the open market. Upon this notification, the customer is free to move without being charged an early termination fee.
The customer must execute the home sale through a real estate agent. When the property sells, the customer retains the applicable home value appreciation. The customer receives the home’s full sale price, less the agent commission and the buyout cost.

EasyKnock Builds Its Equity Release Solutions Platform

As EasyKnock builds its financial services platform, the company noted additional equity release solutions are under development. “Our goal is to become [an] equity release platform. So sale-leaseback as a product may not be right for you. You may not want to relinquish title, you may not want to make a monthly payment, a rent payment. And so how do we add other flavors of equity release solutions under one umbrella?”
By the end of 2024, EasyKnock plans to introduce its unified equity release solutions. In addition, the company will offer innovative solutions for buying and selling residential properties. Taken together, EasyKnock’s offerings will help bring the residential real estate market into the 21st century.