Hi All, I Just want to go over briefly four things that you can do when you're selling your multi-family. Your two, your three, your four unit, your residential multi-family property. Four things that you can do to make sure that you maximize the price. That you get the most. When putting that property on the market, you walk away with the most money that you possibly can as a potential seller.
Four things that you can potentially do. Let's start with number one. You can provide a unit vacant. Why would it be beneficial to you as a seller to provide a unit vacant when selling your multi-family? You have two potential buyers when you're selling, let's say a three family property. You have the owner-occupant buyer. Someone who's going to purchase the property, move into the property, move into one of the units and rent out the other two to supplement their income. Then you have the investor. An owner-occupant buyer is almost always going to pay more for the property, their primary residence, the place that they're going to live, than a potential investor.
Investor's going to come in and they're going to analyze the numbers specifically and strictly and say, "Does this property make sense from a financial standpoint and if it does or it doesn't, I'm going to make my decision based on that." An owner-occupant buyer is going to move in and make it their own. It's the place that they live. There's an emotional attachment to that place. By you providing a unit vacant, you're essentially allowing them to move in. Without a unit vacant, essentially if all three units are occupied, only an investor can buy that property from you. Basically, you're eliminating the owner-occupant opportunity if all three units are tenant occupied and there's not a space for an owner-occupant.
The first thing I would say is I wouldn't go out and necessarily kick a tenant out, but if there's a tenant moving out and you're considering selling somewhere around that same time, you know you have a lease expiring in three or four months, it may be a good time to say let's put the property on the market while I have this potential vacancy and move in at that time.
Number two. Make obvious repairs. If there are some things that need to be done, you are going to maximize your selling price by making sure that the property is shown in it's best light. That seems obvious to some people but many people don't do it prior to selling. Making sure that any appliances that are broken, light fixtures, front door, back door, the front porch, back decks, making sure that those things that are quite obvious as soon as you walk up to the building or as soon as you walk inside a unit, this is clearly not the way it should be. Making sure that those things are done prior to putting your house on the market or prior to putting that property on the market is going to maximize your sale.
Prepare for a spring or summer sale. If you are, let's say it's January 2017 and you are moving into, considering selling, you have about three or four months before that spring market hits, that April, May, you really want to prepare your property for that spring marker or that summer market coming up. The reason you want to ideally sell in the spring or the summer, you have a larger pool of buyers at that particular time. Investors are going to be around all year round. But your owner-occupant buyers, if they're renting an apartment right now and considering buying, their leases typically end sometime during the summer months. You're going to have a much larger pool of buyers. People typically like to move during the summer when things are easier and not moving in the snow, especially in a place like New England. Preparing yourself mentally, getting your documentation ready, let your tenants know about the sale, and making sure that you're getting those things done during the winter months so when the spring and summer roll around that your house or your property is prepared for that sale.
Last but not least, overpricing your property. Don't overprice your property. Price it, I would say accordingly. Talk to your realtor, pull comparable sales, what's going on in the neighborhood, what makes sense for this particular property compared to other sales. When you overprice the property, what you'll end up with is potentially a stale listing. A stale listing is something that's been sitting out there for 60, 90 days and now it's not getting as much attention as it should be. When you do that you actually tend to get a lower sales price then you would have if you just priced the property appropriately from the beginning and sold it as quickly as possible to the best buyers during this spring or summer market.
Again, providing a unit vacant you're going to get more money from an owner-occupant than you are from a potential investor. Making the obvious repairs. Making sure that your property is presentable and showing in the best light. Preparing for that spring or summer sale and not overpricing your property. Making sure that your property comes on the market at a reasonable and fair price compared to other similar properties that are selling on the market. If you do these four things, you'll be sure that your sales price is maximized and you'll get the most money and put the most money in your pocket after the property is sold.