New Investor in a Sticky Situation

[Account Closed]

Hi, all! I’m a relatively new investor and just bought a property near Savannah, GA a few months ago. Due to some life changes, I ended up moving out of the home a lot sooner than anticipated. Now that I’m no longer in the property, I’m facing some issues trying to get it rented due to it now being the slow rental season.

Seeing as how I just bought the property, I can’t sell it without taking a huge loss. I also can’t refinance now without taking a loss. However, the property has been vacant for a little over two months now with no sign of when the rental market will pick back up.

II’m not really sure what my best option is (besides just moving everything back into the property and staying for the next few months/year).

If anyone has any general ideas or suggestions or any specific advice for anyone who knows the area, please feel free to chime in. Thanks!

[Mike Hern]

Quote from @Account Closed:

Hi, all! I’m a relatively new investor and just bought a property near Savannah, GA a few months ago. Due to some life changes, I ended up moving out of the home a lot sooner than anticipated. Now that I’m no longer in the property, I’m facing some issues trying to get it rented due to it now being the slow rental season.

Seeing as how I just bought the property, I can’t sell it without taking a huge loss. I also can’t refinance now without taking a loss. However, the property has been vacant for a little over two months now with no sign of when the rental market will pick back up.

II’m not really sure what my best option is (besides just moving everything back into the property and staying for the next few months/year).

If anyone has any general ideas or suggestions or any specific advice for anyone who knows the area, please feel free to chime in. Thanks!

What zip code? and what are the major cross streets?

[Kenny Kuramoto]

We need more info. But See if there is something you can do to increase the appeal to make it look more desirable. 

[Nathan Gesner]

Quote from @Account Closed:

Is it zoned for short-term rentals? Will the market support using it as a short-term rental? Do you have the funds to make it into a short-term rental?

How would it perform as a long-term rental? Can you at least cover your costs (PITI, maintenance, property management, etc.)?

Give us some details and we can help you analyze it.

[Andrew Freed]

@Account Closed - We definitely need more details however have you considered lowering the price of the long term rental? There are still renters looking in the Winter, I had two vacancies I filled recently, the demand is like 20% compared to the spring and summer. Usually if its sitting long, you are pricing it too high. If people see a unit $100 or $200 below market, they will jump at that deal. Just something to consider. 

[Eliott Elias]

Rent it out, will it cash flow? 

[Patricia Steiner]

Even in a slow rental market, what you're experiencing is not okay.  You're running a business...that's what that vacant property is in reality - your merchandise -and no one stays in business without sales in two months time.  It's time to change your thinking and target your marketing.  Change your perception of what you have and how it has to be used.  You're in a great location and there is rental demand in Savannah now.  Don't wait to change strategies...

[Michael Dumler]

@Account Closed, what are you asking for in rent? How does this compare to other leased properties? How are you marketing the property? Are you marketing on all accessible and essential rental platforms? Were professional photos taken to market the property? What does the listing description say to pull prospective tenants in? Have you considered holding the property as an STR? What would nightly rental rates look like if to were sourced as an STR? Have you lowered the rental rate at all to attract prospective tenants? Where is the property specifically located? Answer these questions and you'll find your solution.

[Chad McMahan]

Quote from @Account Closed:

Hi, all! I’m a relatively new investor and just bought a property near Savannah, GA a few months ago. Due to some life changes, I ended up moving out of the home a lot sooner than anticipated. Now that I’m no longer in the property, I’m facing some issues trying to get it rented due to it now being the slow rental season.

Seeing as how I just bought the property, I can’t sell it without taking a huge loss. I also can’t refinance now without taking a loss. However, the property has been vacant for a little over two months now with no sign of when the rental market will pick back up.

II’m not really sure what my best option is (besides just moving everything back into the property and staying for the next few months/year).

If anyone has any general ideas or suggestions or any specific advice for anyone who knows the area, please feel free to chime in. Thanks!

The good news is that there are TONS of solutions. I recommend you meet over at the property with trustworthy and top producing local: STR PM, LTR PM, real estate agent- and get some numbers and some recommendations from them, with their boots on the ground.

[Phillip Austin]

I'm going to go out on a limb and guess that you may be timid at price reductions given your bigger financial circumstance. Although we are in low leasing season, you should still be able to lease it. You just won't get top market rent like you would in the summer. Barring no other issues with the property/listing, you need to consider price reductions in order to fill it asap.

In your listing, highlight the fact that you're open to different lease terms: 3, 6, 12 and 18 month options.

If you do a shorter lease, you can raise the rent back up to market value at time of renewal. If they choose to move out, you'll be in a more favorable leasing cycle and should have no issue finding another tenant.

If you do a longer 18 month lease, you can add a rent increase for the last 6 or 12 months so you're not stuck below market value for 18 months.

[Drew Sygit]

@Account Closed

There are really only two main reasons a property doesn't rent out:

1) Not enough exposure to the right target audience

2) The audience doesn't like the price-value relationship

To drill down on what the problem is:

How many views are you getting?
---Not enough is a sign that the property is not getting enough exposure, has a bad initial view or is priced way to high

How many inquiries are you getting?
---If a decent amount of people are viewing it, but not inquiring for more info or a showing, then they are not liking what they see when they view the ad. Either price is too high for what it is, or has bad pics or bad description or not enough showing availability.

How many showings are being scheduled?
---Not enough is another sign that price is too high for what it is or has bad pics or bad description or not enough showing availability.

What percentage of showings actually happen?
---If too many showings are cancelled, curb appeal may be an issue or may be part of the market and more confirmation is needed.

Lots of showings but few applications?
---Usually a sign that price-value is perceived to be out of line. Need to lower price or improve the product.

Some more ideas:

1) Is it on the MLS so other agents can show it?

2) Are self-showings being offered for more showing schedule flexibility?

3) Have you reviewed the ad type and pics on your phone (how most prospects will look at) to verify acceptable?

4) What MoveIn Specials are being offered?

5) Is there a 3-D Tour? What about a floorplan, so prospects can envision where their furniture may go?

Ask your PMC a LOT of questions about what they are doing and try to brainstorm fixes.

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