The rehab is complete and ready to go, what’s next? Selling it of course! What tips and pointers do we have for you here?
Setting your initial asking price.
Don’t be tempted to initially list your property for a ridiculously high price. Of course you want to make as much money as possible, but you need to be reasonable. How do you choose your asking price?
Remember when you went through the process of valuing the property and deciding whether or not to pursue the deal? You determined that you would be profitable enough even if the house sold for that lowest comparable price.
Take some time here to review the market again, particularly if it took you a long time to rehab the property. Have values stayed consistent? Gone up? Gone done?
Setting your asking price near the ARV will help you draw the interest of as many potential buyers as possible.
Work with an agent.
We absolutely recommend that you use an agent to sell your home. They have a great deal of knowledge, resources and connections to get your home marketed and sold quickly. As your business grows you may find that you don’t need as much professional help, but in reality you will most likely determine that a good, professional real estate agent will be worth what you pay them. They will help you with everything involved in listing your property – staging, getting the right images, getting it in front as many buyers as they can.
Make sure you take advantage of every listing opportunity you can. Bring opportunities to your agent.
How long is this going to take?
Having realistic expectations will serve you well here. If you have purchased or sold a home before some of this will be familiar to you, and there may be some things that are new.
- Show the house as often as you can. You want as many potential buyers to go through the house as you can.
- The time it takes for you to sell your house (from the day you first list it to the day it goes under contract) is called the “Days on Market”.
- Plan on it taking 90 days to sell your property. A slow market can take as much as 150 days and a hot market can be as low as 30 days. Even if there are some properties selling for faster than 90 days in your area, you shouldn’t count on your property selling that fast.
- Be prepared for potential buyers requesting additional upgrades or changes to the property.
- There are many things that affect days on market or how fast your property will sell. The three biggest factors are price, location, and condition. Properties with a low price, in a desirable location, in a good condition sell faster.
- Remember that the vast majority of potential buyers will be using a traditional mortgage to buy the home. Those loans will take 2-4 weeks to close from the time you get it under contract.
What offer should I take?
Take the first offer you get. Why? If that offer results in a profit for you, even if it is less than you originally thought you would get it is a good deal for you to take it. If your hard money lender does not have prepayment penalties it will possibly save you money. You will have the satisfaction of completing your first successful flip! You cannot put a price on that. Here is more information on why the first offer is the best offer.
You will need to work as hard to sell the property as you did to find it and rehab it. You will find that you learn as much in this stage of your first house flip as you have in all the others.