Sublease for Passive income..?

[Leah Bonner]

Ok at a reiclub meeting I spoke with someone and he brought up the idea of Control without ownership while going to landlords offering them 5 year NO vacancy lease. Then he said to go ahead and RE rent it to other tenants for a profit. 

My question is , is that sublease(?) 
It just seems too easy...?? So after looking into it I found out that most landlords say in there lease they will not allow subleasing (OK thats fine, but if I'm offering them no vacancy, im sure they will accept my terms) 

So for example even if i dont offer the 5 year lease ( The man i spoke with just used that as his example because then he said during that time the owners would more than likely consider selling it as well.. So basically a lease option, but not.. since that term is illegal in texas) 

Ok back to the example I go to a person trying to rent there home for 700... I offer to lease no vacancy 5 years but ill pay 600 a month.. then I turn around and market it as 1,000 a month.
That house then turns into a $400 a month cash flow...

Is it truly that simple???  what am i missing here, it can't be that easy.
(Or maybe it can since there are SO many ways to control real estate)
ANY professional advice would be appreciated :) 

[Mike B.]

The concept you heard about at REI club is essentially a lease option, which seems to be unacceptable in Texas past 6 months. You could look more into a Lease Purchase or Land Contract instead where you are doing a seller carry scenario of sorts, then you could re-rent the property and ultimately re-sell the property. It will require a bit more research for you there.

If you're not doing any buying/selling as part of the deal, then you're looking more at a Master Lease (subleasing) scenario and on a single family home, you're likely to not have much margins.  The numbers have to make sense to everyone.  People may not be as savvy about real estate as you, but they will watch their money and want it to make sense... 

Really depends on how you structure the deal.  Maybe you find a distressed homeowner in need of a solution, or that property that is paid off, vacant, inherited, and someone just doesn't want to deal with it, and you're able to get them on board and accept your offer.  And then you'll have to do the same with your end renter/buyer.