by Chris Sanders
Hilton Head Island and Bluffton are both great markets to own investment property. Demand for both short-term and long-term rentals is at one of the highest levels we have ever seen, pushing rental rates higher and higher. Plus, we are fortunate to have an abundance of property managers for investors not interested in self-management…owning a rental property has never been easier.
Making the decision to sell an investment property is typically a financial decision, requiring more steps than liquidating stock out of an investment portfolio. As such, the most important first step is to consult with your tax adviser in order to be prepared for capital gains taxes, taking advantage of a reported loss or even structuring a capital gain deferment (1031 exchange) if you are considering purchasing a replacement investment.
Once it’s time to go on the market, there are some key considerations in selecting an agent. Be sure your agent is familiar with the in’s and out’s of investment property. They should have access to information and organization tools that can help properly communicate the financial aspects of the property to prospects. Further, they need to have the time and ability to coordinate with the rental manager and/or the tenant directly for showings, inspections, etc.
When taking the listing live, below are a few considerations that can make the process smoother and potentially more favorable financially:
- Talk with your real estate agent about the legality and options of selling a property with any lease (short or long-term) in place
- Have either rental projections or history on file and readily available, and offer an option for a buyer to utilize the existing rental management company
- If the property is not currently under a lease agreement (i.e. Vacant), take this opportunity for maintenance (carpeting, painting, appliance repair/replacement, etc.)
- If a current lease is in place, schedule a meeting with the tenant to discuss the logistics of having the property for sale while occupied
- Furthermore in the case of a current lease, identify whether the tenant would be willing, interested, or even obligated to continue the lease under new ownership
- Incorporate high-quality digital imagery into the marketing campaign so that virtual showings are compelling to investors that don’t have time to tour properties in person
For sellers of investment property, what’s the best way to attract other investors, including the growing base of new investors, into our marketplace? Investors are both local and absentee in our market area, so reaching them requires a quality approach with solid marketing and good preparation…backed with a good understanding of the many variables that can affect a successful transaction.
If you’re considering putting your rental property on the market, or purchasing one as an investment, Collins Group Realty can help answer any and all questions you might have. We can guide you through the process from start to finish. Give Chip a call/text at 843-384-0671 or email Chip@CollinsGroupRealty.com