Email Elizabethduplex in midtown
How it Can Take a Year to Sell Rental Homes in Midtown
Hiring a top Midtown agent is the fastest way to sell rental homes in Midtown.
Once upon a time in a faraway land called the Sacramento Pocket, I sold a rental home that was tenant occupied, and the tenant was extremely cooperative about showings, the home was immaculate, and it sold at top of the market. If I had any children that would have produced grandchildren, this is the bedtime story I would tell them because it is true — yet unbelievable because it so rarely happens. Still, it doesn’t stop me from selling rental homes where tenants reside.
I explain to my sellers that they could be losing a lot of money by leaving tenants in the home while the home is for sale. I know my voice often falls on deaf ears because sellers are more concerned about making the mortgage payment from the tenant’s rental payments, which is understandable. They worry that it could sit vacant forever, which of course it won’t, and they’ll go bankrupt making payments with nothing coming in to offset. Nope, it’s easier for them to leave the tenant in place, even though it might cost them more in the long run.
Take, for example, the effort I recently expended to sell rental homes in Midtown Sacramento — two homes on one lot — which closed last week. After my first inspection, I had initially suggested to the seller that he should evict the tenants, but when he refused, well, nature took its course. First, it’s no picnic to have agents calling and knocking on your door and, in this hot seller’s market in Sacramento, that’s what happens. One tenant was so upset with the showings that she put a sign on her door warning visitors in a threatening manner, let’s just say, to stay away. The other grew tired of the constant parade of buyers kicking her stuff all over the floor.
During the first four months of trying to sell these rental homes in Midtown, the only types of offers we received were lowballs, reflective of the way the home showed with occupants, and we just stopped showing the back house. Four months of open houses, blasting the listing everywhere online, tweaking the photographs, begging agents at my Midtown office to show the home, and fielding calls from prospective buyers — some doing yoga in McKinley Park, others driving by, the bulk scouting homes online — nada.
Then, lo and behold, the dark clouds lifted, the skies opened up, and the tenants abruptly moved out. Almost immediately, we received a full-price offer from a qualified buyer. Unfortunately, that buyer walked away after inspections: older homes often have issues that can frighten the unsuspecting. But within a few days, we received another full-price offer from a qualified buyer who closed escrow with minimum negotiations because we conditioned the sale.
In retrospect, the seller had listed with a cheaper agent last year, a family friend, he had explained. We had talked a year ago but he wanted to “save” 1% of the commission (typical wrong thinking), so he listed with her. Nothing happened during her 5 1/2 months of the listing, I heard. That’s when he hired this veteran, full-service Midtown agent. I imagine he regretted later not following my advice in the beginning and not hiring me to start with, but he’s also grateful I performed. No matter how long it takes, I do not abandon my sellers, and I make it work. Most sales today are not easy.
A Hard to Sell Duplex in Land Park Closes Escrow
This blog is about selling a hard-to-sell duplex in Land Park, not far from my real estate office and my home. Now, one of the reasons that readers come back to my Sacramento real estate blog again and again is because I share stories and lessons I’ve learned in real estate. Even though I’ve been in the business for decades, I still learn something new with each transaction and through each closing, which is what keeps the real estate business exciting and interesting for this agent. This duplex in Land Park is one of those stories.
I just closed this duplex, which wasn’t quite located in Land Park proper, although it is situated in the same ZIP of 95818. I started working on this property a year ago to the very day it closed. This reflects patience and dedication on the part of this Sacramento real estate agent. It was a difficult property to sell. For many reasons.
There was nothing wrong with the property itself, though. In fact, it was a dream listing, if one isolated all of the other factors. It was better than a regular duplex in that it was not constructed up-and-down or side-by-side. The units were not attached to each other at all, which greatly increased the rentability factor. They were standalone, contemporary houses. In great condition.
Location was an issue because the property is under the W X Freeway. That means a duplex located in a desirable area of Midtown, for example, on a quiet street, would sell for more money than a duplex, say, under the freeway. And the sellers initially expected the same price as other duplexes in the area, regardless of location. Top that off with the fact they probably paid too much when they bought it as they are not from Sacramento, plus bought at the top of the market . . . and, well, it’s a recipe for a long struggle.
It’s hard to tell a client they made a mistake years ago. Nobody wants to hear that. Especially a seller who hopes to get top dollar today. I did mention I thought they overpaid even for market conditions at that time, but also explained it was water under the bridge now, realizing my words were probably not fully sinking in. I can’t go back in time to change that original purchase, and harping on a poor financial decision years ago at this point would have been hurtful. I’m not a hurtful person although I do stick to honesty.
Besides, I really liked the sellers. They are sincere, nice people. They are the kind of people who drove hours to Sacramento to meet with me personally because they wanted to shake my hand and look me in the eyeballs. I sell many homes for people I never meet, and that’s OK, too, but some people forge a special connection in person. These guys had worked with other agents in Sacramento and seemed very happy they found me.
Every week or so, I would send them a market update, showing that most duplex buyers either wanted to buy a duplex in Land Park or Midtown in a better area or buy a duplex for less money. Hey, facts are facts. I don’t hide them. But I also continued to plug away for them and pushed for their price. I advised the sellers to raise the rents, which helped tremendously with the cash-on-cash return for an investor. Buyers laugh when you tell them how much they could get in rent if the rent is not already being paid at that amount. You’ve got to show buyers, not tell buyers. I sent buyer feedback from agents.
We found buyers, finally. They came to look at the duplex last winter around Christmas before the rents were increased. These Sacramento investors did not write an offer until June. By then the cash flow was much more appealing. All of a sudden, a few days before closing, the buyers changed their minds and were about to cancel. Their buyer’s agent helped his clients get over cold feet and we closed on Friday. Patience paid off. It took a year, but this agent never gave up.
