The Top Things you Must Do When Selling Income Property
The worst part about finding property for investors is that many of the listings agents don't do what they should for selling income property. Let's look at some very common mistakes that lots of others make.
- No Pictures. You need to have pictures today to draw traffic, and traffic is offers. I know what you're saying, "But it looks terrible inside!". Sure. I'm sure it does. But without pictures you'll get buyers who aren't ready to fix it up, and they walk in, and walk out. Real estate listings aren't cracker jacks - there's not supposed to be a "surprise inside". You're just wasting everyone's time, and your money.
- No expense data. The more you reveal about expense data, the better it is for you. I know - you don't want to reveal it. But when it's not there, your perspective buyer is going to ASSUME what the expense is. Then he's going to double that number, to make sure he doesn't get burned. Everytime he adds $1000, it costs you $10,000. This is a killer, everytime.
- No heating unit info. Separating the heat is a big job, and you need to tell the buyer if you've done it or not.
- No Rental information. Really? It's called income property and you're going to make them guess at the income? If the rents are low, raise 'em up. If that makes the tenants move out, good cause....
- Sell with no tenants. There are so many advantages to selling a building with no tenants. The buyers can SEE it. You can CLEAN it. It can be shown on short notice. Even good tenants have been known to change the locks and not be around or not let people in. They know if the building sells, they either have to move or pay more rent - so don't expect them to help you. I know, you want to collect rent for as long as possible, but having tenants in place will cost you 3-5% of Gross Sale Price for an average building. 2 months of rental income isn't worth that.
Top Things to Remember When You are Marketing Rental Property
- Your best buyer is an educated buyer. The more he believes in the financials of the building -expenses, rents, etc. the more he will be willing to pay. It's math to an investor, help him do the math.
- Pictures, pictures. It works for homes, and it works for income property. Plain and simple.
- Facilitate the sale. Investors don't have a lot of time. Don't restrict the showings because tenants are there, or with accompanied showings. Response time is critical for these buyers.
- Identify updates to infrastructure. Again, it's a math problem. If the investor guesses - he won't guess in your favor.
These items will make your sale faster and for more money! Don't end up on the bad MLS listing list!