You invested in a rental property to make money, but that scenario may look a little iffy when it comes time to sell.
Even in a rocking real estate environment, you may find it hard to sell a rental property for top dollar if you don’t have the right help. Selling your rental property requires great timing, pricing it right, and knowing how to market it to the right audience.
Here are five tips to help you sell your rental property quickly and for the highest dollar.
1. Include Your Tenant In The Selling Process
Your tenant plays an important role in how much money you make selling your rental property. First, decide how you’ll sell - will you wait until the lease expires, pay the tenant to leave, or sell with the tenant in the home?
This answer makes a big difference in how you sell it. If you have to wait until the lease expires, you’re at the mercy of the real estate market when you can sell. If the market is hot now, but your lease doesn’t expire for six months, you must wait.
You won’t need the tenant’s help if you wait until the lease expires. When the tenant vacates the property, you can make any necessary repairs or renovations and get the home ready to sell. Without tenants in the house, you could market it as a primary residence or investment property - the choice is up to the buyer.
But, if you’re selling the home with a tenant in place (turnkey property), you can sell when the market is hot, but you’ll need the tenant’s help. When you sell with tenants in the property, you sell while the lease is active. This means the tenants don’t vacate the property - they remain in it even while the ownership exchanges hands.
It takes a little more cooperation from the tenant in this case, but here’s how they can help:
Ask the tenant to allow any contractors in that you hire to fix up any issues the home may have. If the tenant is staying in the home, he/she certainly won’t mind someone making the home even better.
Work on staging the home together. While the tenant will stay in the home, the investor buying the home may have to market it to other renters in the future. See how well you can stage the home together, so you don’t disrupt the tenant too much but also maximize the appeal of the home.
Work on the curb appeal. If you sell the property online using a marketplace like Roofstock Marketplace, you want the best photographs possible to appeal to buyers across the country.
While you’re not asking your tenants to do a whole lot to help you sell the property, having their cooperation will help, especially when it’s time for the inspection and appraisal - they’ll need to provide the professionals access to the home to complete these tasks.
2. Know The Home’s Value
It’s easy to think a home is worth a lot more than it is when you don’t do your homework. Knowing the market value of recently sold homes in the area will help determine how much you can sell the home for.
Even if you inflate the price because you think your home is worth more, the lenders won’t approve the loan, so unless the buyer is paying all cash, you won’t get more than the home is worth.
This doesn’t mean you should sell your home short - but it does mean you should do a comparative market analysis. A CMA compares three to five properties in the area that sold within the last six months and are similar to the home you’re selling.
You should compare not only the home size and location but also its features. The subject home (your home) may have more or fewer features than the comparable properties, so you must adjust accordingly.
It can be difficult to do this yourself, but when you use a service like Roofstock Marketplace, this is included in the process. You’ll know a fair asking price for the home that lenders will accept because it falls in line with the market value in the area.
3. Take Great Pictures
This may seem inconsequential, but bad pictures could break a deal. The better the pictures you take of the home, the more buyers you’ll entice, and we all know, the more interest you have in your home, the faster you’ll sell it - strength in numbers.
This is especially important if you’re selling the home online, using Roofstock Marketplace. A majority of your buyers will only see the property online because they’re located far away from the property. Real estate investors often look outside their own area and invest in areas where real estate is cheaper or where housing prices are rising, and they can get a good deal.
Needless to say, your pictures are a vital part of the process. Here’s how to take great pictures.
- Make sure the home is decluttered and properly staged. Even if you have tenants in the home, ask them to cooperate for the pictures so you can sell the home faster. You want the home to look spacious while you highlight the best areas of the home.
- Make the pictures realistic. Photoshop and other programs make it easy to doctor up photos, but we don't recommend it. Be honest in your photos, letting buyers see the home’s true layout.
- Use a wide-angle lens on the camera. A wide-angle lens allows you to capture most of the room in one picture while not inflating its size. Everything will seem true to size, but buyers will get a better feel of what the room looks like when everything or almost everything is in one picture.
- Use the sun to your advantage. Try not to take exterior pictures into the sun, but wait until the sun is behind your home. Try to avoid shadows and take the picture at an angle to give a better feel for the home size.
- Take interior photos in bright light. Take your pictures of inside the home mid-day, not too early, but not too late. Aim for around noon when the sun is the highest.
4. Know The Market
Do your research in the market before selling your home. Know what buyers and/or renters want. Depending on how long you’ve owned the home, things may have changed. Knowing the latest trends will help you get the most for the home.
Even though it may cost you money to make renovations, you’ll make it back when you sell the home. For example, if the kitchen or bathroom in the house is outdated, you may want to focus there. Since the renters in the home now won’t be there forever, the buyer will need to be able to fill it with new renters.
Knowing what renters want will help you make the home more attractive for investors. They are likely in it for the long haul, so knowing what the market wants will help you sell the home for more money.
5. Use Roofstock Marketplace To Sell Your Investment Home
Selling an investment home takes a lot more than selling your primary residence. You aren’t selling to someone to live in it. You’re selling them a property to rent out to others.
Real estate agents can help you sell investment properties, but they’ll charge up to 6% commission to sell them. If you sell the home for $200,000, for example, it will cost you $12,000 off the top of the sales price just to sell it. You still have all other closing costs to consider, including prorated taxes and HOA fees, transfer taxes, and any additional city/county fees.
When you use Roofstock Marketplace to sell your home, you have experts dealing with only investment properties. They know how to market your home with tenants in it so that you get top dollar for it.
Roofstock professionals do most of the work for you. All you have to do is gather the information about your home, take great pictures, and submit a listing. From there, Rootstock professionals do the rest.
They’ll conduct a thorough inspection to make sure the home is in good condition and that they have enough information to share with buyers. They’ll also perform an appraisal and financial analysis of the property to provide potential investors with all the information they need.
Buyers and sellers work through the platform to conduct the transaction from start to finish. Roofstock is with you (the seller) the entire time, ensuring you’re satisfied with the process and understand what you’re getting for the home.
When you market to investors who will rent the home out, you have a distinct audience who wants an investment home, which is different from marketing to an audience looking for a primary residence.
How Roofstock Marketplace WorksRoofstock makes it easy to sell your property on their marketplace. It’s free to set up the listing and get everything started. Once your listing is on the platform and available for buyers to see, you’re ready to sell the home.
Buyers can submit bids to you through the platform to negotiate just like you would if you used a real estate agent. You conduct all communication through the platform, and once you agree on a price, you sign a sales contract, and the seller (you) pays 2.5% of the sales price to use Roofstock.
It usually takes 15 - 35 days from the day you submit a listing to get it listed on the Roofstock platform because they do a large amount of analysis to provide buyers, so there is enough information for everyone to make an informed decision.
Once you list, you are eligible to be a part of the Roofstock Openhouse, which gives 24-hour priority viewing of your home. You’ll get the most traffic this way and get the word out about the property you have for sale. Buyers have 24 hours to submit a bid during the open house, and you have 24 hours to respond. This is one of the quickest ways to sell your investment property.
Make Top Dollar For Your Rental PropertyMaking top dollar for your rental property requires that you do your research. Use the right platform, price the house right, and get it ready for new investors. It takes time to sell an investment home, but when you sell it to the right audience, you’ll make the profit you hoped to make and can sell the property with an active lease.
Roofstock Marketplace is a great way to get the help you need to sell your investment property to investors. You don’t have to wait for a lease to expire or worry about being taken advantage of because it was a rental property. Roofstock professionals are with you every step of ensuring you get what you wanted out of the transaction.Image by Pexels from Pixabay