When working with principals, one of the first questions I ask is, “What percentage of properties sold out of your rent roll are sold by your agency”. Nearly all of them say “most”.
I don’t have the heart to tell them that “most” is not a percentage.
In many cases it is, in fact, not “most” at all. In many cases, when the data is crunched, it is less than 50%. Their intentions are often good but the execution sometimes falls down, through no fault of their own. The property owner lists with another agency because they have quoted less commission, or estimated a higher sale price either way, it falls out of the agency’s control. Imagine for a moment that the property didn’t actually have to hit the market and that there was no reason that it ever had to leave the agency’s four walls. Most investment properties under your control have a rich history that most investors want, and you are sitting on this history, keeping it all to yourself. It’s almost highway robbery! Do people still say that?
Investors want to know four keys things:
- How much money is the property tearing up a year in repairs?
- Is it easy to rent?
- How does the price compare to other properties in the market pace?
- Is the current tenant a good tenant, pay their rent on time and look after the property?
It would make sense that if an owner in your rent roll indicated that they were interested in selling, that you package up the property with a “Property Investment Report” showing all the data an investor might want to see. The total maintenance spent last year, rent comparisons for similar properties, days on market data, and a summary of the current tenant. You could then send this out to all of your existing landlords to see who is interested in buying it. You sell the property, retain the commission and retain the management. Win, Win, Win.