As an investor in Livingston, you are likely always on the lookout for the next great deal on a rental home. However, there are times when the property you want may not be listed at a great price, or even at fair market value. If you have your heart set on a home that seems to be out of your price range, it doesn’t necessarily follow that you won’t be able to afford it. Even though making an offer on a property that is overpriced will probably be difficult, it is still possible to make a winning offer by using a few smart tactics.
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. Finding comparable properties that have recently sold in the neighborhood is the best way to ascertain a property’s fair market value. It is also advisable to determine how long the property has been listed. The property you’re interested in is probably overpriced if its listing price is higher than that of comparable recent sales or if it has been on the market for a long time.
As you conduct research, gather all the data you have into a folder or file. In the event that you make an offer, supporting documentation for your valuation of a property could be useful.
Talk to the Seller
Speaking with the seller if you can is another step in placing a bid on a property that is overpriced. There are lots of reasons why a property may be overpriced, ranging from the seller not understanding how to price their home to employing an unqualified or greedy agent. It is also possible that the seller’s motivation is not solely monetary. You might be able to determine the seller’s motivation to sell their house and why they listed it if you make a few specific inquiries. If the seller is in a hurry or has other priorities besides obtaining a high sales price, you may have an opportunity to negotiate a lower price.
Make an Appealing Offer
You must give the seller a good reason to accept a lowball offer when you are bidding on an overpriced house. One tactic you can employ to make your request stand out is to provide rewards or alluring terms. You could include a flexible closing date together with your mortgage pre-approval letter. You could also offer a substantial earnest money deposit or fewer variables to make the deal.
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. Sellers who are hesitant to sell might have an emotional attachment to their homes and might be more likely to do so if they believe a Livingston property manager will take good care of their prized home. It might be possible to make them more willing to let go if you try to make them envision a nice family or young professional enjoying the house. These elements could make your offer stand out from the competition if it is one of several.
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’ll need someone to assist you in negotiating with the seller and advise you 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.
If the time comes to back out of the deal, your real estate agent will be able to support your choice. Some sellers are unwilling to lower their desired price, even if it is excessively high. Even with the assistance of your real estate agent, if you’ve given it your all and are still having no luck, it’s probably time to move on.
By employing techniques like these, you can make offers with greater assurance on any property you believe will make a fantastic rental. Nonetheless, simultaneously conducting numerous comparative market analyses, bargaining with sellers, and managing your Livingston rental properties can be time-consuming. Why not hire someone to handle those duties on your behalf? At Real Property Management Bozeman, 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 406-586-2226.
Originally published on May 5, 2021
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