Real estate investors have made a big discovery. America is on sale. It is the perfect time to purchase good investment properties at bargain prices. Many new investors are considering this the perfect time to enter into the investment arena by purchasing properties hoping they can sell quickly and make a profit.
For investors purchasing with the intent to remodel there is an abundance of available homes in need of various stages of TLC can be purchased for deep discounts as REO properties and motivated sellers continue to increase everyday.
Selling real estate in a slow market is challenging. Everyone from President Obama to the person standing in line beside you at the local Wal-Mart is talking about the decline of real estate values and the difficulty people are experiencing selling their homes. Even with Michael Jackson dominating the news the conversations usually turn back to the housing market, job loss, and the economy, all which have a direct impact on the ability to sell real estate.
If we look at an overview of the real estate market across the United States, we find that many areas have experienced massive property devaluation, high foreclosure rates and poor home sales. Other areas have only seen a modest decline in values and sluggish home sales.
Recent housing reports hint at a glimmer of hope for a slight increase in home sales in some areas. The reality is that the sale of new and existing homes may show slightly improved sales in areas with more stable markets while others are continue to experience stagnated home sales.
Investors purchasing existing homes and remodeling to sell face challenges as they add their properties to a market overflowing with MLS listings and FSBOs.
The big question is this. If we locate a good investment property, purchase it at a deep discount and invest money to remodel it, can we sell it in todays market?
The answer is "yes." You can stimulate your real estate investment property sales even in a slow economy if you educate yourself on the local real estate market before you buy, target desirable areas with increasing populations and stable or increasing home sales and invest in properties that have features appealing to a buyer. This process starts from the first moment you look at the property.
Follow these 10 simple strategies for selling your investment properties and you will increase your odds for success even in a slow real estate market.
1. Buyers today are searching for homes offering extra features, high value, reasonable price, and available first time home buyer financing or other financing programs. Ask your Realtor to provide current information on what type properties are creating the highest number of sales in the area. What is the sale price? Purchase properties that you can market in these price ranges or a small percentage below. Target homes in areas where USDA, FHA and first time homebuyer financing is available to attract first time home buyers. First time home buyers tax credit and other programs will offer you a pool of available buyers.
2. When you are considering an investment property, identify the qualities the home has that will appeal to a wide range of buyers. Choose homes that offer additional square footage, garages, large lots, fenced yards, maintenance free exteriors and other features. Determine the age range of your potential buyer and identify what features they will look for in a home. Enhance or create these features during your remodel and use them as a marketing tool when you list the property for sale. Tour new home open houses to get the latest ideas on what builders are offering then apply these ideas to your home.
3 Women usually make the final decision about purchasing a home, but don't discount the things that appeal to men. While women may fall in love with the spacious kitchen, stainless steel appliances or the master bath, men are looking for other things. Create a workshop area and a space for the John Deere Mower and yard equipment. A nice patio perfect for a family cookout will make the man of the house feel right at home.
4. Choose interior and exterior paint colors that create warmth in the home but at the same time are appealing to buyers in general. Avoid using multiple colors on the interior of the house since it will make the home look smaller. Have a professional to advise you on colors that are neutral but still add soft color to enhance the appearance of the home. Sherwin Williams, Home Depot or Lowe's offers professional information on choosing and coordinating colors.
5. Offer the little extras like book nooks, all season rooms, extra storage, special kid friendly spaces and family areas. The addition of motion sensor lights will offer the buyer a sense of security. Consider installing a home security system and paying the fees for the first year is a big bonus to a buyer.
6. Create a series of "wow's" from the time the buyer pulls into the driveway. A fantastic first impression can be made even if you are on a tight budget. Landscaping, a neatly manicured yard, fresh paint and sparkling clean windows make the home inviting. Coordinate your colors and style inside so that everything from the light fixtures to the floor coverings complement each other to create a total put together look. Pay specific attention to the details when remodeling older homes so everything blends in with the architectural style of the home. With older homes the key is to make everything look like it has always been there.
7. Think green. Install Energy Star appliances and other energy saving features. Even a few energy saving changes in an older home can be appealing to an energy conscious buyer. Your local power company, Home Depot or Lowe's will have information on how to make your remodel more Energy efficient and still stay on budget.
8. Choose properties with family friendly neighborhoods where buyers feel safe. Consult with the local police department for crime rates in the area. Neighborhoods where the majority of the homes are single family and owner occupied are the most desirable. Ask if there is a neighborhood park, pool or other amenities. Some areas have an active neighborhood association which plan family events and have active websites promoting their neighborhood. These neighborhood perks are excellent marketing tools to attract buyers.
9. Consider the surrounding area and the convenience it offers the buyer. Is it convenient to shopping, schools, parks, etc? Is the property on a quiet street or one with high traffic? What does the community have to offer the buyer?
10. Always strive to create a quality product. Nothing will sell your house faster than a home that has been remodeled correctly. Investors who are remodeling homes to sell are competing against large numbers of MLS listings and FSBO's in the same neighborhoods. Many of these will be newer homes. Your attention to quality and detail will set your home apart from other homes on the market. Adding some simple interior and exterior staging will enhance the appearance of the home, highlight desirable features and will offer visual suggestions for use of the space for the buyer.
Investors who take the time to properly evaluate properties, research the market for current home values and sales, consider the availability of financing programs for first time home buyers and who are selecting good properties in desirable areas can be successful even in a sluggish market, creating a good return on their investments.
New investors should contact their area Real Estate Investor's Association and find a qualified mentor who can advise and guide them through their first purchase and rehab. You can visit the website for the National Real Estate Investor's Association to locate groups in your area. Taking the time to learn will avoid mistakes and bad investment decisions that will be very costly.
Delivering more than your buyer expects and offering the home at a price just a little under value will give the buyer a reason to choose your homes over a competitor.
Summary
As real estate investors we are aware that America is on sale. It is the perfect time to purchase good investment properties at bargain prices. Many new investors are considering purchasing properties that they can remodel and sell quickly. For rehabbers there is an abundance of available homes in need of various stages of TLC can be purchased for deep discounts as REO properties and motivated sellers continue to increase everyday. But the question is this...Can we sell in a slow real estate market?
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