December 1, 2022

If you’ve invested in a rental property hoping to make money, you may find it hard to get a high return if you don’t have the right help. Selling your rental property requires proper timing, pricing, and marketing to the right audience.  Here are several tips to help you sell your rental property quickly and for the highest return on your investment.

Include Your Tenants

Having a tenant in the property could be an important factor in how much money you may make when it comes time to sell your rental property. You need to decide whether or not it’s best to wait until the lease expires, pay to relocate the tenant, or sell the property with the tenant still living in the home. These decisions can make a huge difference in how you sell your property. If you must wait until the current lease expires, you’ll be more at the mercy of whatever current market situations you face when it comes time to sell. If the market is hot, but your lease doesn’t expire for six months, you will likely have to wait to sell unless the tenant is willing to work with you. On the flipside, you won’t need the tenant’s help if you wait until the lease expires. When the tenant vacates the property, you can make any necessary repairs or renovations and get the home ready to sell. Without tenants in the house, you are free to market it as a primary residence or investment property.  If you’re selling the home with a tenant in place, you can sell when the market is hot, but you’ll need the tenant’s help.

Depending on the relationship, its often at least worth asking the tenant politely to allow scheduled contractors in to fix up issues the home may need repaired. If the tenant is staying until their lease ends, they likely wont mind someone enhancing the home.  Staging the home is also important to discuss with the current tenant.  Since you will likely need to market the property to other renters down the road, it’s worth trying to stage the home in a way that wont disrupt the tenant too much but also will enhance the appeal of the home.  Dont forget to work on the curb appeal as well. While you don’t want to ask your tenant for too much assistance to sell the property, having their help is valuable, especially when it’s time for the inspection and appraisal.

Know The Home’s Value

It’s easy to think a home is worth a lot more than it is without researching the current market trends. Researching the market value of newly sold homes in the area will help you understand how much you can make on the sell of your property.  Often, if you inflate the price because you believe your home is more valuable, lenders often wont approve the loan. Therefore, unless the buyer is paying all cash, you won’t likely get more than the home is worth.  You should look at several properties in the area that sold within the last six months and are similar to the home you’re selling.  It’s important to compare not only your properties size and location but also all of its features. Your property may have more or fewer features than the comparable properties, in which case, you’ll need to adjust accordingly.

Take Professional Photos

This seems minor, but bad pictures can often break a deal. The better the pictures you take of the home, the more potential buyers will look at your property, and the more interest you have in your home, the faster it will sell.  The majority of buyers nowadays will only see properties online because it’s more convenient or they do not live close to the property. Furthermore, investors often look to invest in other areas where real estate is cheaper or where home prices are increasing to get the best deal.  Needless to say, high quality pictures are an important part of the selling process.

Before taking photos, make sure the property is properly staged and decluttered. If you have tenants living there, ask them politely for their assistance to showcase the home properly. It’s also important that the photos are honest and realistic. There are many programs like Photoshop that will make it easy to manipulate photos, but this practice should be avoided. It is normal to utilize a wide-angle lens which allows you to capture more room in a picture without inflating its  true size. You should also use the sun to your advantage. Wait until the sun is behind your home to take exterior photos. You should also try to avoid shadows by taking photos at an angle.  It’s recommended to take interior photos mid-day, not too early, but not too late. Try to aim for around noon when the sun is the highest.

Learn The Market

As described above, it’s important to learn everything you can about the current market before posting your property for sell. Understanding what buyers want makes all the difference. If you’ve owned the property many years, it’s likely the market has changed. Knowing the latest trends will help you get the most for your home.  Don’t worry to much about making the necessary renovations.  You’ll make it back when you sell the home for more than you would have otherwise. If, for example, the kitchen or bathroom in the house is outdated, you may want to fix those areas now. Knowing what buyers/renters want will help you make the home more attractive for investors willing to pay more money for a property they plan to keep for a long time.

Making top dollar for your rental property requires that you do your research, price the house correctly for the area, and renovate and repair things before you place it on the market. It may take a little time to sell your rental property, but with the above tips, hopefully you will make the most profit possible and sell it faster than you would otherwise.

August 12, 2022

As stocks take a dip and inflation rises, you might wonder if buying rental property is a good place to invest your money.  Seemingly, it’s easy: buy a property, rent it out at a high enough price to cover the payments and put a little extra cash in your pocket.  The goal being that while you do this, property values will increase as rental amounts continue to rise nationwide. While this may still be a great opportunity to the right investor, there are many factors to consider before moving forward with a rental property investment, from rising mortgage interest rates to finding reliable tenants. There can also often be unexpected expenses that pop up out of nowhere. Below is a list of some common questions about purchasing a rental property.

Are Rental Properties A Good Investment In Todays Market?

If you have your finances in order, especially as interest rates climb, rental properties can still be a good long-term investment.  A rental property should generate income monthly, even if it’s only a few dollars to begin with. You should do the math to make sure the property you’re considering is right for your current situation. Consulting a financial adviser or local real estate expert ahead of time is a smart decision that can save you a lot of money and headaches in the long run.

One of the most important aspects to consider is to simply ask, does the deal make financial sense? At a minimum, there should be no net carrying cost to the property. Managing a rental property can be a lot of work.  A lot can go into setting things up correctly, including purchasing insurance, HOA fees, utilities, advertising, cleaning, repairs over time, rising mortgage payments and taxes are some critical factors, to name just a few.  Some rental property owners hire management firms to take care of the property, with fees typically between 7-12% of the monthly rent collected.

As an investment, a rental property can be a slower but still more reliable source of income than flipping a home at the height of a thriving real estate market. Though home values soared in the past few years, that pace is beginning to slow.

How Much Return Should You Get?

Once you’ve crunched the numbers, and if you intend to hold the property for a number of years, even a small profit can be a valuable source of income over time.  For example, a $100 per month net profit (after everything is paid) can add up. If rents continue to rise at 3-5 percent per year, profit should continue to rise, also.  Overtime, that can add up to a pretty significant rental return which doesn’t include appreciation on top of monthly revenue.

What Kind Of Loan Should You Get?

Rental property owners can apply for mortgages like homeowners but with some noteworthy differences. First, the down payment for rental properties is usually significantly larger.  Most lenders require putting a quarter of the total down for a rental property mortgage compared to the average 6-7 percent required for homeowners in recent years.  Lenders view a rental property mortgage as riskier than a regular mortgage because in hard times a primary home will take precedence over all other investment properties.

What Are The Best Financing Options?

Ideally, if you are able to secure a property with all cash and still have funds leftover for a rainy day that is the perfect situation to be in financially. If you are going to take out even a small mortgage, most lenders will require documentation that you have more than enough reserves set aside to cover unexpected expenses.  Before you begin the application process, make sure you have a clear understanding of your budget, that you have researched how to get and maintain having happy tenants and also have a clear idea of all of the rental property management costs.

How Much Can You Borrow?

As interest rates rise in 2022, the strategy of purchasing a run-down property, fixing it up, raising the rent then borrowing against that property to buy another is getting more challenging. Lenders want guarantees the mortgage will be repaid even during difficult times and will comb over the property closely before agreeing to issue you a second loan.

Rental property investors must be even more careful about their budget and assumptions about what future interest rates will look like because they’re not going to be able to refinance to take out equity while maintaining a positive cash flow if rates are twice as high as they were just a year or two ago.

March 25, 2022

If you’ve invested in a rental property hoping to make money, you may find it hard to get a high return if you don’t have the right help. Selling your rental property requires proper timing, pricing, and marketing to the right audience.  Here are several tips to help you sell your rental property quickly and for the highest return on your investment.

Include Your Tenants

Having a tenant in the property could be an important factor in how much money you may make when it comes time to sell your rental property. You need to decide whether or not it’s best to wait until the lease expires, pay to relocate the tenant, or sell the property with the tenant still living in the home. These decisions can make a huge difference in how you sell your property. If you must wait until the current lease expires, you’ll be more at the mercy of whatever current market situations you face when it comes time to sell. If the market is hot, but your lease doesn’t expire for six months, you will likely have to wait to sell unless the tenant is willing to work with you. On the flipside, you won’t need the tenant’s help if you wait until the lease expires. When the tenant vacates the property, you can make any necessary repairs or renovations and get the home ready to sell. Without tenants in the house, you are free to market it as a primary residence or investment property.  If you’re selling the home with a tenant in place, you can sell when the market is hot, but you’ll need the tenant’s help.

Depending on the relationship, its often at least worth asking the tenant politely to allow scheduled contractors in to fix up issues the home may need repaired. If the tenant is staying until their lease ends, they likely wont mind someone enhancing the home.  Staging the home is also important to discuss with the current tenant.  Since you will likely need to market the property to other renters down the road, it’s worth trying to stage the home in a way that wont disrupt the tenant too much but also will enhance the appeal of the home.  Dont forget to work on the curb appeal as well. While you don’t want to ask your tenant for too much assistance to sell the property, having their help is valuable, especially when it’s time for the inspection and appraisal.

Know The Home’s Value

It’s easy to think a home is worth a lot more than it is without researching the current market trends. Researching the market value of newly sold homes in the area will help you understand how much you can make on the sell of your property.  Often, if you inflate the price because you believe your home is more valuable, lenders often wont approve the loan. Therefore, unless the buyer is paying all cash, you won’t likely get more than the home is worth.  You should look at several properties in the area that sold within the last six months and are similar to the home you’re selling.  It’s important to compare not only your properties size and location but also all of its features. Your property may have more or fewer features than the comparable properties, in which case, you’ll need to adjust accordingly.

Take Professional Photos

This seems minor, but bad pictures can often break a deal. The better the pictures you take of the home, the more potential buyers will look at your property, and the more interest you have in your home, the faster it will sell.  The majority of buyers nowadays will only see properties online because it’s more convenient or they do not live close to the property. Furthermore, investors often look to invest in other areas where real estate is cheaper or where home prices are increasing to get the best deal.  Needless to say, high quality pictures are an important part of the selling process.

Before taking photos, make sure the property is properly staged and decluttered. If you have tenants living there, ask them politely for their assistance to showcase the home properly. It’s also important that the photos are honest and realistic. There are many programs like Photoshop that will make it easy to manipulate photos, but this practice should be avoided. It is normal to utilize a wide-angle lens which allows you to capture more room in a picture without inflating its  true size. You should also use the sun to your advantage. Wait until the sun is behind your home to take exterior photos. You should also try to avoid shadows by taking photos at an angle.  It’s recommended to take interior photos mid-day, not too early, but not too late. Try to aim for around noon when the sun is the highest.

Learn The Market

As described above, it’s important to learn everything you can about the current market before posting your property for sell. Understanding what buyers want makes all the difference. If you’ve owned the property many years, it’s likely the market has changed. Knowing the latest trends will help you get the most for your home.  Don’t worry to much about making the necessary renovations.  You’ll make it back when you sell the home for more than you would have otherwise. If, for example, the kitchen or bathroom in the house is outdated, you may want to fix those areas now. Knowing what buyers/renters want will help you make the home more attractive for investors willing to pay more money for a property they plan to keep for a long time.

Making top dollar for your rental property requires that you do your research, price the house correctly for the area, and renovate and repair things before you place it on the market. It may take a little time to sell your rental property, but with the above tips, hopefully you will make the most profit possible and sell it faster than you would otherwise.

May 21, 2021

If you’ve invested in a rental property hoping to make money, you may find it hard to get a high return if you don’t have the right help. Selling your rental property requires proper timing, pricing, and marketing to the right audience.  Here are several tips to help you sell your rental property quickly and for the highest return on your investment.

Include Your Tenants

Having a tenant in the property could be an important factor in how much money you may make when it comes time to sell your rental property. You need to decide whether or not it’s best to wait until the lease expires, pay to relocate the tenant, or sell the property with the tenant still living in the home. These decisions can make a huge difference in how you sell your property. If you must wait until the current lease expires, you’ll be more at the mercy of whatever current market situations you face when it comes time to sell. If the market is hot, but your lease doesn’t expire for six months, you will likely have to wait to sell unless the tenant is willing to work with you. On the flipside, you won’t need the tenant’s help if you wait until the lease expires. When the tenant vacates the property, you can make any necessary repairs or renovations and get the home ready to sell. Without tenants in the house, you are free to market it as a primary residence or investment property.  If you’re selling the home with a tenant in place, you can sell when the market is hot, but you’ll need the tenant’s help.

Depending on the relationship, its often at least worth asking the tenant politely to allow scheduled contractors in to fix up issues the home may need repaired. If the tenant is staying until their lease ends, they likely wont mind someone enhancing the home.  Staging the home is also important to discuss with the current tenant.  Since you will likely need to market the property to other renters down the road, it’s worth trying to stage the home in a way that wont disrupt the tenant too much but also will enhance the appeal of the home.  Dont forget to work on the curb appeal as well. While you don’t want to ask your tenant for too much assistance to sell the property, having their help is valuable, especially when it’s time for the inspection and appraisal.

Know The Home’s Value

It’s easy to think a home is worth a lot more than it is without researching the current market trends. Researching the market value of newly sold homes in the area will help you understand how much you can make on the sell of your property.  Often, if you inflate the price because you believe your home is more valuable, lenders often wont approve the loan. Therefore, unless the buyer is paying all cash, you won’t likely get more than the home is worth.  You should look at several properties in the area that sold within the last six months and are similar to the home you’re selling.  It’s important to compare not only your properties size and location but also all of its features. Your property may have more or fewer features than the comparable properties, in which case, you’ll need to adjust accordingly.

Take Professional Photos

This seems minor, but bad pictures can often break a deal. The better the pictures you take of the home, the more potential buyers will look at your property, and the more interest you have in your home, the faster it will sell.  The majority of buyers nowadays will only see properties online because it’s more convenient or they do not live close to the property. Furthermore, investors often look to invest in other areas where real estate is cheaper or where home prices are increasing to get the best deal.  Needless to say, high quality pictures are an important part of the selling process.

Before taking photos, make sure the property is properly staged and decluttered. If you have tenants living there, ask them politely for their assistance to showcase the home properly. It’s also important that the photos are honest and realistic. There are many programs like Photoshop that will make it easy to manipulate photos, but this practice should be avoided. It is normal to utilize a wide-angle lens which allows you to capture more room in a picture without inflating its  true size. You should also use the sun to your advantage. Wait until the sun is behind your home to take exterior photos. You should also try to avoid shadows by taking photos at an angle.  It’s recommended to take interior photos mid-day, not too early, but not too late. Try to aim for around noon when the sun is the highest.

Learn The Market

As described above, it’s important to learn everything you can about the current market before posting your property for sell. Understanding what buyers want makes all the difference. If you’ve owned the property many years, it’s likely the market has changed. Knowing the latest trends will help you get the most for your home.  Don’t worry to much about making the necessary renovations.  You’ll make it back when you sell the home for more than you would have otherwise. If, for example, the kitchen or bathroom in the house is outdated, you may want to fix those areas now. Knowing what buyers/renters want will help you make the home more attractive for investors willing to pay more money for a property they plan to keep for a long time.

Making top dollar for your rental property requires that you do your research, price the house correctly for the area, and renovate and repair things before you place it on the market. It may take a little time to sell your rental property, but with the above tips, hopefully you will make the most profit possible and sell it faster than you would otherwise.

There are many great reasons to turn to hard money loans, particularly when you need to fund a real estate venture, fix-and-flip or other short-term investment opportunity. However, while many people have great reason to start with hard money loans, this is also a popular place to turn when you cannot get funding from the bank.

Hard money loans are a great option for a number of different types of investors—and as most investors know, most banks’ lending practices have become stricter in recent years. This is particularly true for investment properties. Timing, income, sell potential and credit score can all cause a bank to turn someone down for a loan.

However, when banks say “no” you can still come to a hard money lender in order to get the money that you need. Many times, they are willing to say “yes” even when a bank says “no.” This is not the only perk of a private lender and of hard money loans. It is also a great option for those who need their funds quickly. While a bank may typically take around 90 days in order to get the lendee their funds—private funders and hard money loans can come within a couple of weeks, or less.

However, it doesn’t mean that everyone always gets approved for the hard money loan requests that they make. This is why there are a few different pitfalls that you will want to try to avoid when you turn to hard money loans after the bank.

• You don’t have any of your own money in the investment. If you don’t have any skin in the game—your hard money lender may be apprehensive about approving your loan. A loan that covers 100% of the property purchase can be a hard sell. Your lender will want to know that you are also putting some of your own money into the investment.
• You don’t have enough cash on hand. While you don’t need as much money up front with a hard-money lender, you do need to prove that you have the cash to make the monthly payments as you pay back the loan.
• You don’t have an exit strategy. Hand money loans are typically short-term and include a large payment at the end of the term, such as when you sell the investment property. While you are obviously going to have a detailed plan that you are intending on following—you should also explain a back-up plan or exit strategy to repay the loan. This can be refinancing, pulling money from a different source or selling the property.

Keeping these common pitfalls in mind can be very helpful when you go to get a hard money loan. Remember, it is a different process than going through the bank, but ultimately it may be the best and easiest way for you to get all the funding that you need.

If you are interested in fixing and flipping a property, then one of the best ways to get a great property at an even greater price is to bid on a home through a real estate auction. There are so many investors who are able to turn a huge profit because they are able to get properties at a low price through auctions.

However, bidding on a property through a real estate auction is very different than buying a property any other way. This is why it is so important to understand the best way to bid on homes through real estate auctions. Here are a few tips to help you get started:

• Don’t Forget to Do Your Homework- Before you go to an auction, make sure that you do your due diligence. Many auctions are on foreclosure properties, which is why you need to make sure that you review the title before you head to auction. Some sellers will only offer a quit claim deed on transfer—which means they are only giving away their rights to the property and there is no protection from other claims to ownership or liens.
• Get Your Funding Lined Up First- Remember, a majority of real estate auctions only accept cash, so you need to make sure that you have the money ready before you get to the auction and are clear about what the rules are. The good news is, sometimes private mortgage loans, transactional funding and hard money loans are accepted, just make sure that the money is ready to go.
• Know the Auction’s Website Rules- Every auction platform is unique and will have different rules so you can make sure that you are participating. Some platforms require you to be an authorized real estate broker—others limit who is able to bid, whether they are owner occupant buyers or investors.
• Be In It to Win It Until the End- Make sure that you stay in the auction until the clock actually runs out. A lot of action happens in the last few seconds of the auction. You never know what can happen in the final seconds, so whether you think you are about to secure the deal or someone else is, you should stay in the auction in case you get outbid or someone drops out.

Don’t forget, while real estate auctions can be a great way to bid on a property—there can be a lot of risk with bidding on properties through auctions. Keep these tips in mind and make sure to do your research ahead of time so that you can make a smart investment at any upcoming auction.