Selling an Investment Property in a Seller's Market = Win-Win, Right?

In my last blog, I discussed the struggles of being an Investor buyer in a seller's market, and how to overcome the obstacles it creates. Now let's switch gears and talk about being an Investor who is selling their property in a Seller's Market. What's to talk about you ask? Should be a win-win situation, right? Well not so fast as there are still hurdles to jump and things to consider even when having the market advantage.

Sellers, you are probably getting top dollar and multiple offers for your property, but you still need to stay competitive. Investor Buyers are not accepting just anything because of a housing shortage. If they can't find what they want, they will wait. So it's important to make sure your property shows well by having made that investment in remodeling, staying competitive and truly comparable. And it's just as important to have that outside curb appeal as it does to have an interior that says "Cash Flow". Many times the reason why properties are commanding top dollar is because of the effort an owner has put into renovating and maintaining it. Sometimes this can be tricky when you have tenants. Having a property that already has paying tenants can often be seen as an advantage over a vacant property, though sometimes this becomes circumstantial. The important thing here is to have your property ready for interested buyers who want to see the whole property. Again, having tenants that's not always easy, as often they don't want people coming into their apartment or the timing isn't right. Suggestion is to have a description of what will happen upon your decision to sell, right in the lease. That way, from the get go, people know they must avail their area to all potential buyers. You still want to sell it, right? Ok, well get fit to sell.

It all starts with hiring a professional consultant such as a good Realtor, one that will be professionally candid with you as you sit down together to discuss selling your property. While you should interview a few Realtors, ultimately choose the one with whom you "gel" and who has the best credentials to represent you. Welcoming your Realtor's opinions about what will help your property sell is important. Try not to take things so personally that you can't be accepting of a professional opinion. Since a Realtor lives and breaths real estate, is in properties every single day of their lives, and has a track record of sales, they are the experts in their field. Therefore they can provide you with valuable insight. But alas, not all Realtors are created equal. You want a Realtor® that is a part of NAR, The National Association of Realtors, as that is someone who is committed to their profession, dedicated to their clients, and must strictly follow the organization's code of ethics. You need a Realtor to help you sell a home, an investment property or a business as their experience is invaluable. And of course, they must have experience with investment properties as that type of real estate has it's own unique intricacies.

No matter who you choose, after the initial consult with agreement to proceed, the next steps should be getting pictures and an eye catching description for the MLS and Social Media. Remember, you want a strong and all-encompassing promotion of your property. You want buyers to envision buying your property and all it offers. And there is a lot that an investment buyer must consider when purchasing an investment property. Many calculations to see if a property is investment worthy is part of their decision and you as the seller can assist in that determination. Be sure to have rent rolls, expense information and lease information available to help the buyer fully understand the opportunity.The ultimate goal, for you, is to sell for the highest price obtainable...an informed buyer will act more quickly and result in a good deal for both you and your buyer..

It's funny, yet sad at the same time, when I come across poor quality pictures on a listing. Everyone deserves to have their property showcased in the best possible light, so having good pictures is extremely important. A picture may speak a thousand words, but two of them shouldn't be "No Thanks". So get rid of the dark pictures, or sideways ones. This isn't the batcave, this is your investment, so show it off. And speaking of those thousand words, make sure your Realtor is writing a glowing review of your property highlighting it's strengths. An eloquent and well written description makes people envision what they are about to see. And that's HUGE. So play upon it's strengths such as cleanliness, available parking/transportation and trendy area it's in, for example. Your Realtor should be taking advantage of all forms of social media and gathering events. And that can mean doing an Open House, if vacant, or several private showings, with your current tenants availing their areas for view. The ultimate goal is to get an acceptable offer and close on the property as quickly as possible.

And helping you to review those offers is another strength of a strong Realtor--the negotiation process. Yes it's a "Seller's Market" and while that typically means multiple offers with a great price, you still want to compare all of the offers carefully. Having a good Realtor will help you understand the terms of each offer. That way you can make the most informed and sound decision on which offer to accept. And speaking of financials, get an accountant involved in understanding the tax ramifications of selling your property. As having been an investment Buyer, you already understand concepts like interest and depreciation plus tax deductions for repairs, travel expenses, independent contractors, insurance premiums or other legal and professional services you've hired out, but also understanding capital gains and depreciation is extremely important as it can help you calculate the best approach for offsetting a sale. And there are a lot of things you can do prior to the sale of your property that can involve how your mortgage is structured or possibly even the option of 1031 exchange. Get with a business accountant to help maximize your financial investment.

You can be a successful investment Seller. It makes perfect economic sense to put your property on the market today. But even in these times where affordable housing is in a shortage while demand is high, it takes initiative, planning and resourcefulness to make it a smooth move. So get to selling the right way!

Your Home.Your Business. Your Future!