5 Ways to Sell a Rental Property

Parting ways with a rental property isn’t easy. However, it can be a strategic move to help you maximize profits within your own business. Why not optimize your investment portfolio? Selling off a rental property can free up your time and capital to do other things. There are different ways to go about trying to sell a house you’ve held as a rental. Each method offers distinct advantages and can be tailored to fit specific situations and goals. Certain methods may be more advantageous for your own personal selling strategy that can help you maximize your investment return.

Here are five effective methods to consider when selling your rental property.

Sell to a Cash Buyer

Selling to a cash buyer speeds up the transaction process of real estate. There are no long delays waiting for mortgage approvals. Cash is quick! This method is particularly useful if the property requires significant repairs, as many cash buyers are willing to purchase properties "as is."

Alex Capozzolo, co-founder of SD House Guys, a cash buyer located in San Diego CA, mentioned, “Offering to pay for a rental property in cash is the way to go. It separates your offer from the competitive because it makes everything easier on the seller. Plus, landlords can relate to each other. We pay cash to other investors for houses constantly. When everyone is on the same page, it’s nice.”

Make sure you vet any cash offers to confirm they can actually close. Don’t accept an offer before seeing proof of funds. Some investors will say they have the money when they do not. Although cash offers are sometimes lower than market value, the speed can help it outweigh the price difference.

Sell to Your Tenants

Selling directly to your tenants is a streamlined option when trying to offload a rental property. They know the home well and might be interested in owning it. Start by offering them a first right of refusal. This approach simplifies the sales process as there's no need for property showings to multiple potential buyers. Plus, it can save on realtor commissions. Make sure the tenants are qualified to potentially buy your property. Also, they must eventually apply for a mortgage to make sure they can close.

Use a Real Estate Agent

Hire a real estate agent who has dealt with rental properties before. They will add value and help you sell your home quickly. Agents have market knowledge that can be helpful in pricing your property competitively. They handle marketing, showing the property, and negotiating with potential buyers, reducing your personal time investment. While this method incurs a commission fee, the potential to attract higher offers can offset the cost. Choose an agent experienced in selling rental properties for the best results.

Market the Property as a Turnkey Investment

Highlighting the investment potential of your property attracts real estate investors. Market it as a turnkey property. This means someone can buy it from you and not do any work after closing. Especially if it has a good rental history and reliable tenants, mention that on the listing.

Showcase how easy it is. Flaunt how strong the rental income and occupancy rates are. Utilizing online real estate investment platforms can also widen your audience. This method emphasizes the income-generating capability of your property, making it appealing to a niche market.

Conduct an Auction

Auctioning your rental property is another way to sell it quickly. The idea here is to create a bidding war. Urgency will spread among the buyers like the common cold. This method is effective for properties that are located in competitive markets. It allows for a transparent sale process and a definite end date, reducing the time your property spends on the market. Contact a reputable auction house with experience in real estate. They can guide you through the process and handle the details of the auction.