How many times have you seen “Offer Subject to Inspection,” “Drive by only,” “Do not disturb tenants?” I hate that. I have to drive by, look at a few meaningless pictures and rely on assertions by the seller/listing agent about condition, current rents, market rents, etc. You really are making blind offers and once the offer is accepted, you figure out how accurate the listing was. While I am a Real estate Investment Broker, there are many agents who don’t know how to provide the information to an investor to evaluate a property or they are just listing the property for the commission and don’t put in all the information you need or . . .
Basically, we have to go back to President Reagan’s statement about inspecting Russian nuclear programs during the Cold War – “Trust, but Verify.”
Basically, a lousy presentation of your property starts with a lack of trust. Think about that. Is that how great business deals are made? You need trust. I have specific strategies using third party data and services to provide independent verification of the property that makes it easy for a buyer to trust the information and have greater confidence in their offer. It makes it easier for the buyer to make an offer. When it is easier to make an offer with confidence, you will get more offers for a property priced appropriately.
Let’s address appropriate price. If you list your property for $1, I will whip out that dollar, pay for all closing costs, complete due diligence in a few minutes on my own close in 1-3 days. If you list your property for $10MM, not even billionaire real estate investor Donald Trump will buy your property. Of course these are extremes, but they point out that pricing is very important to get offers.
There are essentially two strategies to listing prices.
- Price the highest you can and take the best offer you get
- Price low to create a bidding war
The challenge is that you really need a lot of ready, willing and able buyers willing to pay your price in order to shoot for the stars on price. Timing a market is impossible for mere mortals like us and I learned decades ago that my crystal ball is far cloudier than I originally thought. It is a really bad idea to try and time the peak of a market, because you can easily miss the peak.
The best strategy is to figure out what you are willing to accept and compare that the current market prices and see if we can get that price. The higher the price, the longer you are on the market searching for that buyer willing to pay more. At a certain point, the listing can go stale and people start wondering what is wrong with the property that the other buyers saw that you might be missing and you have to drop pricing to get interest again.
These are investments so everyone is looking for cash flow and they want it to be easy. This leads to more choices you have when listing your property for sale.
- Do I sell it as-is with no repairs and accept a lower price and faster sale.
- Do I make all the repairs and upgrades, increase rents to market and make it a completely turn-key rental for the investor who doesn’t want a hassle and wait awhile to find that buyer and get top dollar.
New rent control laws have complicated this a bit, but nothing we can’t strategize around to get you top dollar. Contact me to manage your property now so you don’t get bitten when you decide to sell in the future.
There are costs to marketing like this and they run a few thousand dollars. I have personalized marketing and sales programs for you where I pay for this marketing and preparation cost to create a compelling offer to the buyers to get the best offers for you.
Bottom line is that even with a phenomenal marketing program, if you don’t have a compelling offer for the buyer, you won’t get top dollar fast.
Contact me to discuss how we will work together to get you the right price to suit your timing.