You’ve decided you want to sell a current rental property. If you’ve not sold investment property before, you’ll want to understand the differences from selling your personal home. To help, we offer suggestions on how to avoid these seven mistakes when selling your rental house.
- Not Telling / Involving Current Tenants
If tenants currently live in the rental house you plan to sell, the first thing you do is TELL them. First off, not telling tenants you plan to sell their home is just plain rude. Secondly, many tenants may actually want to purchase their rental home, especially if they’re longer-term renters. At the very least, you will need their cooperation when it comes time to show or hold open houses.
- Underestimating Actual Selling Costs
Remember the napkin test <insert link> we discussed in an earlier blog? This comes in handy again. The average agent commissions and closing costs only give you a ballpark estimate. Different agents, types of mortgages, and many other factors can drastically impact the final hit to your profits. You’ll need to do your research and prepare to cover any sellers’ costs at closing.
- Failing to Do Pre-Listing Home Inspections
Before you even think about listing a home, you must absolutely conduct an independent home inspection. You may think everything in the house is in good order, especially if you conduct recommended periodic inspections. A professional inspector can give a thorough review of everything the house needs now (or soon). You can choose to make repairs or disclose to sellers. But you won’t get caught flat-footed if their home inspector turns up an unexpected problem.
- Focusing on the Wrong Repairs or Upgrades
Of course, any repairs required for safe renting should receive attention first. But after that, which upgrades will provide the highest return? When selling a rental house, focus on upgrades that future renters will find most attractive. Knowing how much of an upgrade a rental home should receive takes expert insights. Their recommendations can prevent overspending on high-end items or unnecessary replacements if current conditions work just fine.
- Outpricing What the Market Will Support
When setting the listing price to lead with your head not your heart. This means your agent and should you set a price on par with comparable houses. An overpriced house will receive less interest. The longer a house sits on the market, the more buyers will think there is something wrong with it. Public property history thwarts any attempting to pull from the market to relist at a lower price.
- Choosing A Real Estate Agent Inexperienced with Rental Properties
Your real estate agent can make or break the successfulness of an Orlando-area rental home sale. You need someone with extensive knowledge of target audiences, comparable rentals, and the “personality” of the rental home’s neighborhood. A good agent can recommend upgrades and staging techniques to attract buyer attention. They know which aspects of the home to highlight for potential buyers, prompting where and how they advertise it.
- Not Properly Staging Your Property
In general, prospective buyers find clean, clutter-free, well-decorated rental homes more appealing. Clutter can make your home appear smaller and make it more difficult for buyers to picture themselves there. Conversely, barren rooms provide no spatial reference points or sense of purpose for a room. Did you know that staged homes sell 88 percent faster and for 20 percent more than those that aren’t? (Refer back to Mistake #1 on the importance of involving current tenants.)
Having an expert to guide you through the entire process can take the stress out of selling your rental home. You need someone with years of rental property realty experience. The Realty Medics specialize in real estate sales and investments. With more than 20 years of experience in the Central Florida market, we can help. Call us today at 321-218-4753 to get started, or complete our online form to learn more.