| Often, there are renters living in a home that is listed for sale and although it may be best to have them move out, the sellers may need the rental income to make the mortgage payment. There may be a lease that the renters refuse to terminate and the closing date may have to be extended to accommodate the expiration of the lease. Not all renters are cooperative with the selling process; it is inconvenient and they have no incentive to help the owner maximize their sale.
I recently had a couple getting a divorce and their investment property needed to be sold. The renters had lived in the house for several years and it was very worn. There were five residents, they didn’t keep the house clean, they two mean dogs, and it was difficult to show.
We were required to give a 24-hour notice for showings, as stated in their lease, which prevents many buyers from seeing the property. If buyers are going out look at several homes and they are denied access to one, they typically remove it from their list, unless they can’t find anything else.
The property needed fresh paint, flooring, and repairs, to get top dollar, but the seller couldn’t do so, with the renters living there. It is difficult to market a property like this as they don’t photograph well, and most buyers decide which homes they want to see based on the photos. The sellers decided to sell the property “As Is”, and listed it for $20,000 below market value. Many buyers were turned off and couldn’t picture themselves living in a house that was dirty or worn, or they didn’t have additional funds to make improvements after closing.
We decided to offer the renters a financial incentive to cooperate with us in selling the home. We scheduled open houses a couple of times during the week to cut down on the disruption of showings, they agreed to try to keep the house clean, and remove the dogs, as well as move out with a 60-day notice.
Because of the discounted price and lack of inventory, the house sold in multiple offers for more than the list price, but for less than what is would have sold for with some minor improvements.
An experienced real estate agent, can guide you through selling your home in a difficult situation.
Ask the Real Estate Agent is a weekly column by Cheryl Kempenich of Coldwell Banker Burnet, who lives and offices in the Chisago Lakes Area. Submit your questions to firstname.lastname@example.org. All information is deemed reliable but not guaranteed. For legal assistance consult an attorney.