5 Tips for Selling Rental Properties
It takes time to revive a rental home and get it in order to sell as a residential property. The biggest challenge is to transform the home from rental status to residential quality. The last thing you want is a potential buyer to walk in and be taken back to their time of renting (which isn’t always a positive experience). But you also don’t want potential buyers to be turned off by a house because it emulates a rental in every room. We've all rented homes or apartments. We know how they were treated, things that were broken or how previous tenants left the home. This property is going to be a buyer’s new home for much longer than a 1-year lease, so the space needs to be clean, inviting and desirable.
After helping several clients revive and sell their rental properties, these are the five main tips I’ve seen come in handy. I hope they work for you as well!
1. Clean, Clean and Clean!
Most rental properties need to be thoroughly cleaned and repainted. I’d recommend doing this before tackling any other upgrades or repairs. It will give you a clean slate to work with and make your time in the home a bit more enjoyable since you’ll probably have a few weeks worth of repairs ahead of you. Speaking of painting, paint everything you can and don’t forget about the ceilings and trim.
2. Create a Budget for Upgrades and Repairs
It’s very likely that you’ll need to budget for a few upgrades before selling a rental property, but it’s also just as likely that you’ll need to budget for general maintenance especially if the last tenants weren’t particularly nice to the home. One quick and budget-friendly upgrade that can make a big difference is replacing the carpet. Most rental homes have carpet because it is the most cost effective to replace. I had a client who just replaced all the old carpeting in their home for $1.36 a square foot. This included removal of the old carpeting and installing new carpets and pad. While this doesn't add value to the home, it helps the saleability. Nothing smells better than new carpet, and the thought of moving into a home with flooring that no one else has ever lived on is hard to beat. I would also suggest having specialists check out the roof, HVAC, crawlspace and do a termite inspection. The future buyer is going to have a home inspection, but why not try to get ahead of repairs that might be needed?
3. Don't Forget the Landscaping
Rental homes are not known for elaborate landscaping. They are mowed weekly by a lawn care service, and that is about it. Just like any home on the market, curb appeal is everything. Trim the bushes, plant a few flowers and upgrade the mulch. Again, we don't want the first thoughts of a buyer to be, “oh this must have been a rental.” Spend some time cleaning up the backyard as well. Make sure all trash is removed, weeds are cleared, and evidence of past pets (toys and waste) are also cleaned up.
4. Include Appliances
Attached appliances like the range and dishwasher are expected to stay with the home. But what condition are they in? Are they clean? Do they work? If you are dealing with old, damaged appliances it would be beneficial to replace them. Again think about the buyer who will be walking through the home and is blown away by all new appliances that come with the home.
5. Understand Your Market
Working with a Realtor® to determine a listing price is crucial. Before starting on any renovations to the home meet with a trusted agent to understand the market. Not only can your agent show you comparables of similar homes but they will walk through the home with you to determine a course of action and what needs to be done to prepare the home for sale. Your agent can also refer you to specialists who can get the work done right.
