You’re happy with the equity that’s grown in your investment property and decide to cash in and sell. At this point, the right advice can appeal to many buyers rather than just a pool of investors that aren’t interested in paying top dollar.
We look at the top 7 essential tips that will save & make you money.
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Provide documentation of your rental income.
Get your property manager to print out a ‘rental ledger’ and include this in your legal selling documents (section 32’s). This will demonstrate the history of the rate of rent paid in hard copy.
How does this help you? If another property investor purchases your investment, they can also use this document in support of their finance approval.
Potential buyers can feel comfortable competing when submitting an offer as the rental ledger provides peace of mind. This can mean more dollars in your pocket.
Tip: make sure your rental property is generating the highest value rental income possible.
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Use a local real estate agent.
As much as people dislike dealing with real estate agents they are a necessary evil. A good real estate agent has access to many local buyers, they are trained negotiators that understand how to create an environment to empty a buyer’s pocket.
When selling your property, real estate agents do most of their work out of view of the people that hired them. Hence why most agents are known to exaggerate truths to condition vendors price to get a deal done.
If you want to avoid dealing with agents, a vendor advocate is hired to manage a real estate agent’s behaviour and the details of the selling campaign. They’re experienced real estate agents that look out for the seller’s interest.
The best part about hiring a vendor advocate is they work their fee into the real estate agents commission, hence they don’t cost any more to hire and are only paid if the property sells.
3. Wait till your tenants are out of contract.
Time your selling campaign to the end of your tenant’s lease term. This gives your property a chance to be viewed by more types of buyers that require vacant possession.
Messy tenants that have a lot of clutter can cost you tens of thousands of dollars when selling. They can also ruin your selling campaign making it last longer reducing the chance of competing buyers.
To achieve a potentially higher sale price, it’s been a popular trend to stage your property with designer furniture to create a display home feel. To do this, a property must be vacant. Why?
A tenant’s furniture or clutter can have the opposite effect. It’s also great for your real estate agent to have unrestricted access to your property so many buyers can come through. Tenants usually require 24 to 48 hours notice prior to an arranged inspection.
Have a chat to your property manager to work out the type of tenant that lives in your home. Ideally, it would be great to walk through the property with your vendor advocate.
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Be Smart About Renovations.
When it comes to renovating your property for sale, money spent in the right places can increase your bottom line. Things like new carpet, fresh paint or some light landscaping.
Property buyers are not looking to purchase a property with a high quality finish so don’t put money into improving the quality of the home. The rule of thumb should be to make the place look neat and clean without any necessary work to be carried out by any future buyers.
5.Offer the property to your tenant first.
If you’ve had a long-term tenant occupying your investment property it’s likely they would be interested in buying your property if it suddenly becomes available. If all stars align and an opportunity to do this type of transaction presents, it can save you time and a lot of money in selling commissions and loss of rent.
6. Don’t sell if you don’t have to.
Buying a house in 2019 presents great challenges and barriers to entry. The areas buyer’s struggle with is housing affordability, financing and paying government taxes.
With the history of capital growth in Australian properties over the last 20 years, it makes sense to hold on to your property and make it work.
If for some reason you must sell to move forward to your next venture, we put together some great tips when selling your property.