Posted by JohnBoy on January 11, 2001 at 13:42:46:
What does your ad say?
Having trouble selling first investment house - Posted by Bob in Atlanta
Posted by Bob in Atlanta on January 11, 2001 at 13:23:49:
I closed on my first investment house on Oct.13. I fixed it up and put it on the market mid-November. It appraised at $405,000 and I am asking $389,000. I hope to sell for at least $363,000, which is the property tax appraisal.
I have budgeted to carry it for up to 1 year, but obviously I want to move it ASAP and get on to the next one. My marketing is the AJC newspaper, both listing services, and I have a professional 3’X 2’ sign on the street.
I know that the biggest issues in selling are price and terms. Should I just be patient?
What Sells a home Price or Terms? - Posted by Michael Morrongiello
Posted by Michael Morrongiello on January 11, 2001 at 23:33:56:
Bob:
You just committed the fatal mistake that most Realtors make when dealing with a listing that is not selling (bless their hearts). They frantically try to convince their client (the seller) to lower the sales price. ONLY when the client lowers the sales price the home STILL does not sell, Huh?
I believe that you need to “blitzkrieg” the market with this home by trying to sell it for TOP DOLLAR (around $400K assuming it WILL appraise) using OWNER FINANCING as both a marketing and financing tool.
If you put the word out that you will take $40K cash down and be willing to finance the balance ($360K), then my bet is that you will get a whole lot more interested parties in that home.
Now, I don’t suggest that you are going to hold that $360K trust deed. That paper if properly structured, you can sell to a note funder (like us) for immediate cash liquidty.
You get a significant amount of cash, the buyer gets into the home without being put under more traditional lender “microscopes” and everyone moves on with their lives.
Contact me if you need some assistance.
To your success,
Michael Morrongiello
Re: Having trouble selling first investment house - Posted by Jim IL
Posted by Jim IL on January 11, 2001 at 21:06:43:
Bob,
Since the home is not selling, as was said below, you need to figure out why?
Most times, the issue is price.
This can be overcome by changing the price, or selling on some terms.
Since you already budgeted for carrying the home for one year, then why not sell it seller financed somehow.
You can set the terms on this to attract a decent buyer, and make them refi it when that year is up.
This way you’ll not have the cost at least of holding it any longer.
You could even sell it with two notes, and sell the first to get your cash out.
Land contract with a high interest rate, and get the buyer to refi at six months.
L/O and get some cash out now, and close in one year.
Plenty of things to do in order to get out of the holding costs.
And while you are doing that, go buy another home that will get you some cash now.
A wholesale flip, or a L/O could get you some needed cash now.
Just don’t let this deal sit and eat you up, and keep you from moving forward.
Good luck,
Jim IL
Re: Having trouble selling first investment house - Posted by dewCO
Posted by dewCO on January 11, 2001 at 20:26:17:
Depends on how your ads are drawing and what condition it is in relative to others in the neighborhood. I guess you got to do the math to see at what point you start dropping the price. If your ad already says something like “below market price come and get it” or “sacrifice” and you’re still not getting much action then you gotta start lowering the price. Don’t know how much you’re going to make on it, but if you’d take $363 and that is way below market value, I’d put the price closer to that to move it quicker.
Re: Having trouble selling first investment house - Posted by AnnaSalk
Posted by AnnaSalk on January 11, 2001 at 17:59:44:
I was just wondering if you considered PACTrust under the circumstances, and if not, why not?
Re: Having trouble selling first investment house - Posted by CurtNY
Posted by CurtNY on January 11, 2001 at 14:31:47:
Bob,
You said it would appraise at $405,000 your asking $389,000 but will let it go for $363,000 I don’t have all the details (your market, if you’re using an agent, etc…) but if I’ve had a house on the market since November, I would do some investigating as to why its not selling. At that level your holding costs have got to be eating into your profit heavily, if you’re willing to drop the price why wait, all your doing is increasing your holding costs. You’ll probably end up selling at a lower price anyway. Remember, Price or Terms, definately don’t be patient, when making offers be patient, when trying to sell a rehabb, GET IT DONE and move on! Best of luck
CurtNY
Re: Having trouble selling first investment house - Posted by Nate
Posted by Nate on January 11, 2001 at 14:07:46:
In general, this is a slower time of year to be selling a house. There are fewer buyers in the market and the marketing time may be a little longer than if you were doing it in the spring or summer.
However, assuming the local market is reasonably healthy (I would figure most parts of Atlanta are), and your property is not overpriced, it should sell in as much time as other listings take to sell in the market.
I don’t know what that length of time is in your particular submarket. Here in the DC area, listings in “hot” neighborhoods are usually under contract within a week or two (at most). In less desirable areas it could be three to six months.
Also, you mention that you have the house listed in the MLS. Do you have an agent selling it for you? If so, what did their market analysis suggest as the selling price. I know you said the house was appraised for $405,000, but I find that an agent who knows the market well will often have a better idea of value than an appraiser, who may be using comps that are months old.
Good luck!