Time is everything when trying to complete a rehab. Despite what you may see on TV, schedules are of the utmost importance when trying to maximize your return on investment (ROI). Every day your property goes without being sold, your returns will be diminished. The longer you hold onto a property, the more you will have to pay in taxes, insurance, loan repayments and other utility costs. Additionally, you are indirectly losing money by not recouping your investment and having your money tied up in a property you haven’t sold. “Time is money” is more than just a catchy slogan, but something that will directly impact your bottom line. Essentially, the faster you can complete a rehab, the better it is for your business. Make sure you sell your rehab as fast as you can, without compromising integrity.
In order to sell your rehab in a timely and profitable manner, you must first implement a proven strategy. There is no excuse for not having a sales plan ready for when the house is completed. By the time the home is ready for the market, you should already know your marketing strategy. Take the appropriate steps to attract interest prior to putting the house on the market. With the advent of social media and advancements in internet technology, marketing a property has never been easier. Gone are the days when you would have to wait until the weekend to get an ad in the local newspaper. Social media alone can spread the news of your property quicker and much more efficiently than anything else you can do. Additionally, there are many real estate websites that you can place your property on. There is no need to wait until the last coat of paint is on the wall to get started. It can be debated as to whether or not you should show the property in unfinished condition, but there is no reason that you cannot post pictures or even a video of the property well before you are ready to sell.
While you are working on creating interest in the property, you need to think about what price point you are going to list at. The condition of the property is important, but nothing is as important as price. Buyers will compare your property with everyone else that has sold or is currently listed on the market. Despite what you may think of your own property, it is important to leave emotional connections out of the decision. If you list too high, your property will do nothing but collect dust on the market. Not only is this costing you time, but it can have lasting negative effects on the property. Once a realtor or prospective buyer sees an overpriced listing, they quickly dismiss it and it will take a fairly dramatic price reduction to get them back. If you try to shoot for the moon and set the bar too high, you will lose time and numerous prospective buyers for your property.
If you list at a fair market value, or even below, you can attract the interest you are looking for. Ideally, you will not need to sell for an inflated amount to get the profit you are looking for. Listing on the low side of the market, without giving the property away, will create demand and should give you some buyers to choose from. Making a little less to get the property sold will free up capital for other purchases and grow your business exponentially throughout the year. Every property is different and you need to pick and choose your spots, but if you are looking for a quick sale you need to focus on listing at the right price.
Even the best rehabs with the highest quality work will not sell themselves. You need to give the house life and buyers the feeling they are actually buying a home they can live in. Sometimes all you need to do is stage a property or add a few special touches. Every time there is a showing for the property, you need to make sure the house looks perfect. The first impression for a potential buyer means everything. Keeping the temperature warm enough or the choice of light bulbs for each room can make a house feel like a home for some buyers. Everything about the property will be judged – from the smells to the welcome mat. If you want to sell quickly, everything has to be perfect.
Finally, a quick sale walks the line between getting as much as you can and knowing where to offer concessions. You may need to be flexible with your contingencies or allow a small credit to get the property sold. A $1,000 credit when, you are making many times that, shouldn’t get in the way of a transaction. If you keep the big picture in mind and think about the advantages of selling quickly, you will realize that these things aren’t really that big of a deal.
The best deals are not always about getting the highest price. Maximizing value is always nice, but a quick cash closing at a reduced price may be a better deal than a lender financing deal in 45 days. The speed of the closing will have many residual effects. Time is money on every deal. If you are trying to sell as quickly as possible, you need to think about the big picture.