Update on Out-of-State Properties For Sale

Update on Out-of-State Properties For Sale

Rental Property Investor · South San Francisco, CA · Member since 2019 · 262 posts · 95 votes

I had to remove four of my out-of-state properties in order to refresh the listings and start anew. I will be lowering the asking price and seeing if that will help in the sale of these properties. Looking to either sell individually or as a package to an investor. These are 2-bedroom, 1-bathroom properties that I had originally planned to keep in my rental portfolio, but my plans changed. My current agent suggested if it made sense financially, to do some rehab work to get the properties rent-ready, but I do not have the liquid funds to do so and sell these as-is. I do have monthly mortgages to be paid and not having rental income to offset my negative cash flow has been a learning experience and really trying to think of what options I have to have better success at this. Some interested buyers did go under contract but things fell through in the deals. We've noticed 3/1's have had more success as that is what investors are looking for and hindering my chances at a sale. Really looking for tips on what to do from investors who have been in this type of situation. Currently just waiting it out and hoping for the best to start the year so I can move on and dive into better opportunities.

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Robert BellBusiness Member
Lender · 38119 · Member since 2021 · 71 posts · 71 votes
1y

If you find an investor to buy them, send them my way for the loan.

Avalon Capital, LLC579 Reviews
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  • Stuart UdisPro Member
    Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes
    1y

    @Arron Paulino Your posts illustrate the challenges of exiting SFH's in markets where the natural buyer is another investor and not home owner. It sounds like the 2 BR floor plan makes this process even more difficult. I don't believe "waiting it out" is an effective strategy. Perhaps that's the correct option if you are selling a SFH to a home owner that has unique design characteristics but not in the context of what you are facing. Determine the price that attracts the investor, stop the bleeding and and move on.

    The only other option that comes to mind is to make the improvements and try to achieve favorable rental rates to push the story that 2 BR homes rent for a premium because its unique. I know in Philadelphia if I had a 2 BR house it would be viewed favorably by tenants who are seeking 2 BR living situations because most inventory will be apartment style living and for this reason would achieve a rent premium. Not sure if this holds true in your market. Also I understand the funds aren't available for the improvements so that is another obstacle that has me leaning towards price reductions to move on as soon as possible.

    The exit of lower tier SFH's is something very few investors care to consider when making their investments but deserves far more consideration.

  • Real Estate Investor · Memphis, TN · Member since 2016 · 422 posts · 141 votes
    1y
    Quote from @Arron Paulino:

    I had to remove four of my out-of-state properties in order to refresh the listings and start anew. I will be lowering the asking price and seeing if that will help in the sale of these properties. Looking to either sell individually or as a package to an investor. These are 2-bedroom, 1-bathroom properties that I had originally planned to keep in my rental portfolio, but my plans changed. My current agent suggested if it made sense financially, to do some rehab work to get the properties rent-ready, but I do not have the liquid funds to do so and sell these as-is. I do have monthly mortgages to be paid and not having rental income to offset my negative cash flow has been a learning experience and really trying to think of what options I have to have better success at this. Some interested buyers did go under contract but things fell through in the deals. We've noticed 3/1's have had more success as that is what investors are looking for and hindering my chances at a sale. Really looking for tips on what to do from investors who have been in this type of situation. Currently just waiting it out and hoping for the best to start the year so I can move on and dive into better opportunities.


     I am in Memphis, I would be curious to know more about the properties. I will say I am a wholesaler however I work remotely in the nashville market. I own a couple vacant lots and looking to purchase more in a small area. 2/1s in Memphis, as far as I know, are as desirable as in a bigger market. While 2/2s are better 3/1 are more desirable because of the heavy section market in the city. Sounds like you are in a tight spot. If there is anything I could do (drive by, analysis/insight on the area) I would be glad to help.

  • Rental Property Investor · South San Francisco, CA · Member since 2019 · 262 posts · 95 votes
    1y
    Quote from @Stuart Udis:

    @Arron Paulino Your posts illustrate the challenges of exiting SFH's in markets where the natural buyer is another investor and not home owner. It sounds like the 2 BR floor plan makes this process even more difficult. I don't believe "waiting it out" is an effective strategy. Perhaps that's the correct option if you are selling a SFH to a home owner that has unique design characteristics but not in the context of what you are facing. Determine the price that attracts the investor, stop the bleeding and and move on.

    The only other option that comes to mind is to make the improvements and try to achieve favorable rental rates to push the story that 2 BR homes rent for a premium because its unique. I know in Philadelphia if I had a 2 BR house it would be viewed favorably by tenants who are seeking 2 BR living situations because most inventory will be apartment style living and for this reason would achieve a rent premium. Not sure if this holds true in your market. Also I understand the funds aren't available for the improvements so that is another obstacle that has me leaning towards price reductions to move on as soon as possible.

    The exit of lower tier SFH's is something very few investors care to consider when making their investments but deserves far more consideration.


     I agree to just stop the bleeding and move on. I think right now is trying to find the right price to sell at to attract attention and get them liquidated faster is the MO right now. Any tips on this?

    As much as I'd love to rehab the properties to boost the ARV (which was the initial goal), funds are tight right now to do that so as-is is the way for me to go.

    Absolutely.

  • Rental Property Investor · South San Francisco, CA · Member since 2019 · 262 posts · 95 votes
    1y
    Quote from @Jamie Parker:
    Quote from @Arron Paulino:

    I had to remove four of my out-of-state properties in order to refresh the listings and start anew. I will be lowering the asking price and seeing if that will help in the sale of these properties. Looking to either sell individually or as a package to an investor. These are 2-bedroom, 1-bathroom properties that I had originally planned to keep in my rental portfolio, but my plans changed. My current agent suggested if it made sense financially, to do some rehab work to get the properties rent-ready, but I do not have the liquid funds to do so and sell these as-is. I do have monthly mortgages to be paid and not having rental income to offset my negative cash flow has been a learning experience and really trying to think of what options I have to have better success at this. Some interested buyers did go under contract but things fell through in the deals. We've noticed 3/1's have had more success as that is what investors are looking for and hindering my chances at a sale. Really looking for tips on what to do from investors who have been in this type of situation. Currently just waiting it out and hoping for the best to start the year so I can move on and dive into better opportunities.


     I am in Memphis, I would be curious to know more about the properties. I will say I am a wholesaler however I work remotely in the nashville market. I own a couple vacant lots and looking to purchase more in a small area. 2/1s in Memphis, as far as I know, are as desirable as in a bigger market. While 2/2s are better 3/1 are more desirable because of the heavy section market in the city. Sounds like you are in a tight spot. If there is anything I could do (drive by, analysis/insight on the area) I would be glad to help.


     I'll send you a DM on these properties and see what you think.

  • Robert BellBusiness Member
    Lender · 38119 · Member since 2021 · 71 posts · 71 votes
    1y

    If you find an investor to buy them, send them my way for the loan.

    Avalon Capital, LLC579 Reviews
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