As a real estate investor in Roslindale, you’re likely looking for the next budget-friendly rental property. But occasionally, the property you desire may not be listed at a bargain price, or even at fair market value. It doesn’t automatically follow that a property you have your eye on—even one that seems to be overpriced—is unaffordable. Although making an offer on an overpriced property will likely be difficult, it is still possible to do so using a few effective strategies.
Determine the Fair Market Value
A comparative market analysis is one of the best places to begin if you believe that a property you’re interested in is overpriced. To determine the fair market value of a property, it is best to locate recently sold comparable properties in the area. Checking how long the property has been listed is another smart move. The property is likely overpriced if it is priced higher than comparable recent sales or has been on the market for a long time.
As you research, compile all the data you find into a folder or file. If you make an offer on a property, supporting documentation for your valuation could be useful.
Talk to the Seller
Another step is talking to the seller, if you can, before placing a bid on a property that is overpriced. There are many factors that can contribute to an overpriced listing, from the seller simply not knowing how to value their home to using an unqualified or opportunistic seller’s agent. Additionally, the seller may be motivated by factors other than monetary gain. You might be able to learn the seller’s motivation for listing their home by asking a few specific questions. It may be possible for you to negotiate a lower price if the seller is pressed for time or has needs other than a high sales price.
Make an Appealing Offer
When bidding on a pricey home, you must provide strong reasons for the seller to think about your lowball offer. One strategy you can employ to make your request stand out is to offer incentives or favorable terms. You could include a flexible closing date together with your mortgage pre-approval letter. To sweeten the deal, you could also provide a sizable earnest money deposit or fewer contingencies.
Consider writing a letter outlining how you will take care of the property or perhaps the future you see for the property if the seller isn’t financially motivated. Sometimes hesitant sellers have an emotional attachment to their homes, and they may be more likely to sell if they believe a Roslindale property manager will take good care of it. They might be able to let go a little easier if you try to make them imagine a nice family or young professional enjoying the house. These features could make your offer stand out from others if it is one of many.
Hire an Experienced Buyer’s Agent
Employing an experienced real estate agent will vastly improve your chances of convincing a seller to reduce the price of an overpriced property. You will need assistance negotiating with the seller, as well as advice on when to walk away. Even if you do everything in your power to make your offer appealing, sellers of overpriced homes are unlikely to accept the first one you submit. With a skilled agent on your side, you will be better equipped to participate in multiple rounds of negotiation without the process taking up all of your time.
When the time comes to withdraw from the transaction, your real estate agent will also be willing to support your choice. Some sellers will not negotiate their desired price, even if it is excessively high. If despite your best efforts and the assistance of your real estate agent, you are still unsuccessful, it is likely time to move on.
Using these strategies, you can boldly make offers on any property you believe would make an excellent rental home. Accomplishing several comparative market analyses, making deals with sellers, and monitoring your Roslindale rental properties at the same time can be time-consuming. Why not hire somebody to assume these responsibilities? At Real Property Management Boston, we offer our rental home investors professional market analyses on prospective properties and comprehensive rental home management. To learn more about what we have to offer, contact us today or give us a call at 617-522-0099.
Originally published on May 5, 2021
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