Offering Property For Rent And Sale Simultaneously
With sales slowing and interest rates rising, many homeowners are considering property management if the home they’ve listed for sale doesn’t get a timely offer. Provided that the sale of a home isn’t necessary for a future purchase, marketing a property both for sale and for rent at the same time can potentially get someone living in your home sooner.
However, is listing your property for sale and rent the right choice for you? Here are some items to consider when making your decision:
MIXING & MATCHING: Does your agent’s firm offer rental services? Listing a property for sale with one firm and renting with another can cause problematic communication between two agencies with competing goals. Some firms may even refuse to take on a listing with another firm involved. It may be most beneficial to list with a single firm for both services to ensure that internal communications are timely.
COMMUNICATION IS KEY: If you get an offer to lease and an offer to purchase simultaneously, there should be a plan for how to proceed. If your property manager signs a lease on Tuesday but an offer to purchase is received on Wednesday, the purchaser is subject to buying the house, the lease, and potentially property management services. However, if an offer to rent is received but tenant acceptance is delayed due to a pending sale offer, the tenant may go elsewhere to find housing. This leaves you empty-handed and gambling on a bona fide sales offer.
TIMING IS EVERYTHING: Rental transactions are typically consummated in a matter of days, whereas a sale has numerous layers (home inspections, financing, etc.). Listing for rent before the home has a fair chance to sell usually results in a rental, so waiting a few weeks to list for rent levels the playing field for the sale effort.
BUILD A BUDGET: Are you financially prepared to be a landlord? If an essential system or appliance fails, you don’t have the luxury of waiting to repair or replace it after you put tenants in the property. Budgeting and planning for significant replacements and emergencies is crucial. If a tenant fails to pay rent, you’re still responsible for the mortgage and should be ready to cover it for several months in a worst-case non-payment situation.
The items above assume you are marketing an empty property or one in which you live. If you have a rental that you plan to sell or re-rent when your tenant gives notice, there are even more things to weigh regarding timing. The advice of an experienced property manager can be invaluable when deciding which course of action is right for you. Our team of property managers at The Real Estate Group are always ready to help landlords evaluate their options. Let us show you why so many landlords feel TREG is the RIGHT CHOICE for managing their investment properties.