If you are planning to put a rental or an investment property on the market in Fargo, you should know that the process of title transaction will be a bit different from that when you sell your primary residence.
You will come across some distinctive challenges when selling income-generating real estate in Fargo or anywhere else for that matter. The primary reason is that you will deal with buyers from a completely different segment. They won’t be regular buyers who will make your property their primary residence after purchasing it, but real estate investors. They would purchase your property only if you are offering them a profitable deal.
So here are eight important tips for you to follow before listing an investment property for sale in Fargo:
Perform a home inspection
You should have the property professionally inspected before listing it for sale. You probably didn’t live in the property. You rented it out, so it is possible that you are not aware of the damages the tenants may have caused.
If these defects come up during the home inspection from the buyers and you end up acting surprised, it will give them a very wrong impression. The excuse that you were not aware of the defects will not work in your favor.
Once you know the defects, now you need to determine whether you want to sell the property as-is or you will make repairs. If you decide to sell the property without making repairs, you will have to deduct the cost of repairs from your asking price.
Have the relevant data and documents ready
Prospective buyers will ask you to provide rent rolls, landlord ledgers and documents telling them net operating income and expenses. Have them ready before you put the property on the market. Verify the credentials of the buyer before providing him or her with these documents.
Keep your tenants in the loop
It is very challenging to sell a rental when tenants are living in it. Find out if the prospective buyer is willing to buy the property without you having to ask your tenants to move out. In some cases, you may have to wait till the lease expires.
You should coordinate with your tenants before showing the property to prospective buyers. You need to comply with specific laws in this regard. If you have hired a real estate agent, try to have him or her coordinate directly with the tenants for showings. That way, you won’t be bothered every time a prospective buyer turns up to visit the property.
You can also give your tenants the first preference and ask if they would like to buy the property. It’s a far-fetched possibility, but if they want to buy, it will make your job a lot easier.
Your prospective buyers’ primary focus is on making money. You should come up with a competitive listing price. Analyze the latest trends in the real estate market in Fargo and come up with a sales and marketing strategy accordingly. You also need to ensure that you are not violating the rights of tenants currently occupying your property. Follow your legal obligations.