As an investor in Charlestown, you are likely always on the lookout for the next great deal on a rental home. The property you want might not always be listed at a great price, or even at its fair market value. It doesn’t necessarily follow that a property you have your eye on is out of reach just because it seems to be overpriced. Even though it will probably be difficult to make an offer on a property that is overpriced, it is still possible to do so by employing a few smart strategies.
Determine the Fair Market Value
If you believe that a property you’re interested in is overpriced, conducting a comparative market analysis is one of the best places to start. To determine the fair market value of a property, it is best to locate recently sold comparable properties in the area. It is also advisable to determine how long the property has been listed. 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 conduct your research, compile all the data you discover 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
Talking to the seller if you can is another step in placing a bid on an overpriced property. A listed property may be overpriced for a variety of reasons, from the seller simply not knowing how to value their home to use an unqualified or opportunistic seller’s agent. Additionally, the seller might not be solely motivated by financial gain. You might be able to determine the seller’s motivation for listing their house for sale if you make a few specific inquiries. If the seller is in a rush or has other priorities besides obtaining a high sales price, you may have the opportunity to negotiate a lower 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. Offering rewards or enticing terms is one tactic you can use to make your request stand out. You could include a flexible closing date together with your mortgage pre-approval letter. To sweeten the deal, you could provide a substantial earnest money deposit or fewer contingencies.
If the seller is not money motivated, try writing a letter describing how you plan to maintain the property or your vision for its future. When hesitant sellers believe a Charlestown property manager will take good care of their beloved home, they may be more likely to sell; because they sometimes have an emotional attachment to their homes. 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 factors might make your offer stand out from the competition if it is one of many.
Hire an Experienced Buyer’s Agent
Employing a knowledgeable real estate agent will greatly improve your chances of convincing a seller to reduce their asking price on a property. You’ll require assistance in negotiating with the seller and guidance on when to back out. 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 your trained agent by your side, you will be better equipped to engage in multiple rounds of negotiations without wasting too much time.
Additionally, if you decide to back out of the deal, your real estate agent will be able to support your choice. Even if their asking price is way too high, some sellers won’t budge. It is best to move on if, despite your real estate agent’s assistance, you have exhausted all possible avenues without success.
Using these methods, you can convincingly make offers on any property that you believe will make a great rental home in the future. Nonetheless, simultaneously conducting numerous comparative market analyses, bargaining with sellers, and managing your Charlestown rental properties can be time-consuming. Why not hire somebody to assume these responsibilities? At Real Property Management Commonwealth, 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 617-299-2342.
Originally published on May 5, 2021
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