Can't Get a Property Sold
Hello everyone,
I have a property in Indianapolis that I bought a year ago that I'm trying to sell conventionally but it has been on the market for 3 months with only one serious offer. Any ideas on how I can sell this property? Of course I can dramatically cut the price and sell it fast but I'd rather sell it for what I bought it for at least. Any advice is appreciated.
Regards,
Lower the price. Real simple. ;-)
I heard a saying once: bulls make money, bears make money, pigs get slaughtered.
It appears this property has been a ‘millstone’. Drop the price. Sell, even at a loss. And move on.
You're probably right Alan, thanks for your input.
@Jason A. what's compelling you to try and sell? Any reason not to rent it out and keep cash flowing?
Can you owner finance it to someone instead? Your best option really depends on the reason you are wanting to sell.
Here's the listing,
https://www.redfin.com/IN/Indianapolis/726-N-Bradley-Ave-46201/home/66925644
I'm only selling because I'd like the funds to buy another nearby property (got married).
Hey @Jason A....no offense, but those pictures are terrible. And is your realtor 15 years old? Hashtags everywhere?
The house needs a ton of work. And with a duplex that needs work, you're marketing to investors, so they're going to want ARV "meat-on-the bone" to take your fixer upper. I saw a nearby comp (only one property, who knows if its truly a comp) selling for 109k, so if someone takes this from you for 59k, there isn't a ton of room there for rehab and refinance.
What could a rehabbed 1 BR/1 BA unit fetch in this rental market? If you could bring up the units with an influx of cash and rent them out, what would be a better option for you?
Without knowing much about the areas/rents, it seems like a better deal in your pocket unless the property has serious issues?
Joe,
Thanks for the input. There are no major issues. When you say it needs a ton of work, what do you mean?
The market is $550 for a 1bd/1ba so both sides would have a $1,100 per month gross income. Following the 1% rule would have the property at a $110,000 value. Which means the investor could put in $51,000 to reach that metric, but they don't have to.
Regards,
@Jason A.
I agree wholeheartedly on the pics and hashtags. First pic is important. It’s awful. My thoughts exactly on all the hashtags. What is going on with that?
We don’t need a pic of the roof. It looks old and Reminds me to budget for its replacement.
For a couple thousand bucks you could make this place look pretty nice: clean the mold/mildew or whatever the black stuff is under the eaves and on the base of the front porch post, touch up the paint, get rid of the mismatched cabinets with missing drawers, the faux brick, the wood paneling, the beat up and dirty dark flooring and replace all that with updated but inexpensive builder-grade materials, put a real handrail on the front porch instead of the ugly 2x6... I think a little lipstick upgrade would go a long way on this one. Then take better photos (current ones are way too dark), raise the price to $98k and market it to CA out of state investors. Selling it for what you paid a year ago means losing money and rule #1 is don't lose money.
We removed the hashtags and we'll get better pics tomorrow with no roof shots. It's about 11 years old.
I agree with you on this and I'll consider making the changes you suggested. Thanks.
- @Jason A. looks like a few people called out what I was talking about. The pictures do it no justice, and there are clearly issues in the house -- you can see them right away from the pictures.
- Black mold under the roof (2nd picture, also reveals some green on the siding and pillars...a quick cleanup would help with that) - - Clear lawn issues (5th picture, also shows a vehicle in the middle of the backyard?)
- - No lights on in the picture, terrible resolution and contrast (6th picture...also what is with the black things on the ground on the carpet?)
- - Does the place have popcorn ceilings (8th picture, there is some texture on the ceiling)
- - Your hardwoods look god awful, like they need to be refinished, plus wood paneling -- yuck. (13th picture)
- - Probably one of the most dated kitchens I've ever seen (14th picture)
- - What appears to be a leak of some kind in the kitchen, top right (15th picture)
- - Drop ceiling...yuck (16th picture)
- - No pictures of bathrooms, but I bet they're a disaster.
So lets recap -- this place needs a ton of work. I realize the rents are cheap but being in a D/C rental with such low margin after putting in a ton of work? Would you take that on as an investor? I sure as hell wouldn't. And just from what I can see -- new kitchens needed in both units, probably revamped bathrooms in both units, refinishing hardwoods (or laying a new floor on top) at the very least (not considering other issues/needs like lawn care, cleaning, painting, etc., and assuming electrical and plumbing are good)...at 59,000 plus rehab costs, there is no room for someone when they're only making $1100 a month.
This goes back to my original point -- an investor is going to want this property on the cheap because it needs a lot of work to be "rent ready" in my opinion. And if they operate in this market, I bet anyone worth their scuttle knows how little that return is, so they want to be all-in at 50, not buying for 59k and then doing a 25k rehab. You might get an inexperienced investor at this point.
Not to mention the rental market for 1 bedrooms is probably difficult. 2 bedrooms, plenty of units and plenty of folks needing it. 1 bedroom may limit your pool of applicants. Do either of these units have extra rooms that could be turned into a bedroom? Now you're talking big time where you can take the space and create value out of it on top of the reno.
I found two places on CL that seem to be better looking and for more than what you're asking in rent.
https://indianapolis.craigslist.org/apa/d/indianapolis-historic-irvington-apt-1/6925121560.html
https://indianapolis.craigslist.org/apa/d/indianapolis-736-bradley-ave-free-alarm/6950490572.html
Both of these look 10x better than what you're showing (or the pictures are crap) and appear far more "finished" -- I'd pay the extra $25-$75 dollars for a place that looks better.
@Joe P
Point taken. I'll do work on it to make it more worthwhile for someone to buy.
Regards,