How to Sell Your Rental or Rehab Property Fast
Why you need to sell faster:
Time is money. There’s no circumstance where that statement is truer than in the field of real estate investment. Every day that your property sits on the market, you’re losing bundles of money. Holding costs, security and liability risk, rising interest rates, and looming market crashes put your equity at risk. Here we’ll share some valuable guidance to improve the return from the resale of your investment property.
Setting Your Investment Selling Goals
Before you get started, it’s important to keep in mind some predefined goals that will direct your efforts and allow you to be more realistic and effective in selling your investment property.
Get yourself into a successful selling mindset by being objective and looking at the property from the buyer’s point of view. Think about what will be important to your ideal buyer. What will they be looking for, and scrutinizing, as they evaluate your property? As you’re getting ready, keep in mind the three primary goals:
- Get the most for your property when it sells.
- Sell it with the least days on market.
- Avoid selling headaches and risk.
Find an Investor’s Real Estate Agent
Real estate professionals can make your life much easier, and net you more for your property. Local expert real estate agents know your market, what the property will likely sell for, and what appeals to regional buyers. They can help you avoid over or under-improving your property (both will lose you money). Ask for referrals from others in the investment community.
You’ll want to work with an agent that understands the needs of investors, and is capable in determining the value of your property by the market comparison and income approaches to valuation.
Selling it yourself as a ‘for sale by owner’ or ‘FSBO’ might seem like an appealing choice to avoid paying a listing agent commission; however, for sale by owner properties typically end up selling for less and spending much longer periods of time on the market (increasing your holding and financing costs).
Preparing Your Investment Property to Sell
If you want to net the most from selling your rental or rehab property, it’s an excellent idea to clean and declutter, select a neutral color scheme, get an inspection, make needed repairs, and stage the property. Taking these steps will tremendously increase the appeal of the property, and eliminate the objections that will more than likely be raised at a critical point in escrow.
Picking the Right Season to Sell Your Investment Property
The best time of year to sell your property is in the spring and summer months. During these times there is the greatest demand from buyers looking to make their first buy, relocate, or move-up. Take advantage of the fall and winter seasons to ensure that the property is ready for all weather conditions. During this time, you can make updates to the interior, complete repairs, and inform your renters, if any, of your intent to sell (a courtesy, but not required).
Pricing Your Rental or Rehab Property to Sell Fast
Choosing the right price for your property can be accomplished by understanding the list vs sales price ratio, the impact of utility costs on local values, demand for properties with similar features, and factoring in association fees and tax assessments. Play it safe by giving more weight in your valuation to sold properties, rather than those that are currently on the market. Active listings tend to have highly exaggerated list prices that do not give an accurate idea of the actual value of your investment property.
Marketing Your Investment Property for a Quick Sale
Get it sold quickly by increasing your market exposure. If your price is a little high, you might still have a chance at selling it with an effective marketing strategy. If your price is in the pocket, you’ll have it sold in a minute with a solid marketing approach. Your first decision is to hire an agent or sell it yourself. When you work with an agent, you have the advantage of their experience, market knowledge, and network connections. Brokers and agents know and represent most buyers in the marketplace.
Either way, ensure that your property is published online as broadly as possible and that the highest-quality photos, video, and virtual tour represent it. Make sure your marketing materials are mobile friendly and optimized for view on smaller devices.
Negotiate to Get the Most in Selling Your Rental or Rehab
Don’t leave money on the table by showing weakness in negotiations. Select a tough agent or plan on what range of terms you will accept. Calculate how much you’ll net when the property closes. Insist that your buyer is pre-qualified, shows proof of funds, and offers a sufficient deposit and down payment to demonstrate their commitment and minimize the risk of an escrow cancellation.
Speed is Everything
Selling an investment property is supposed to be an impartial and objective process that results in a straight forward sale and the highest price. That’s seldom the case as we get emotionally charged with the excitement of selling and negotiations.
It can be an enjoyable process, that when strategically planned, can offer you a satisfying selling experience and the highest offers for your investment property. Stay focused and remember: time is money.