Of course, as you get more motivated, you have to look at the whole picture; and lowering to FMV or at least down to the appraisal should be a natural start.
But as another posted yesterday, you have only been on the market for 2 weekends; you need to give it time. Have your agent that you have the property listed with let you know the average days on the market so you can see about when you should have had a contract in hand.
Let time go by a couple of weeks to see what happens, then review that pricing scheme you have to bring the asking price nearer appraisal or FMV.
I have not had much success in finding a tenant/buyer for my property yet. Apparently, there is a lot of real estate available in my area, and T/B’s can afford to be picky. I have advertised the property in the largest local paper for the past 2 weekends, I have also used the free Nickel paper for the past 2 weeks. Additionally, I have used a local web site “spokanebyowner.com” to advertise the property.
So far I have had 6 responses, 4 from the big paper, 1 from the Nickel Paper, and 1 from the Internet. I have showed the property 2 times but not been able to get the people to see it at the same time as each other. The first one to look at it, scheduled to bring some family members back yesterday, but didn’t show up.
The others who called got the address to drive by and I haven’t heard from them since. I must admit, I am feeling a little discouraged, but I am committed to going forward since I own the property outright and am tired of making payments.
Re: Having trouble finding a T/B, any suggestions? - Posted by Blane (MI)
Posted by Blane (MI) on November 11, 2002 at 20:59:10:
Ron,
I just went through the same thing you now are, and rest assured I did my fair share of whining here. IMHO 2 weekends just isn’t enough time to get too worried. Mine took about 45 days, due to a slow market combined with my incomplete and somewhat incorrect read of my market.
Some you’ll never hear from again, some won’t have any money, etc. you just have to weed through them but the right one will come along. Just make sure you understand your market area and what you’re competing with, and everything will be OK. Patience, Jedi.
Re: Having trouble finding a T/B, any suggestions? - Posted by Dave(WA)
Posted by Dave(WA) on November 11, 2002 at 16:00:10:
Hi Ron,
What is the address for you place? I live in Spokane also and keep fairly in tune with the markets. I’m also not afraid to give constructive critisism. I’m really curious about the outcome of this for you since I’m contemplating doing a L/O on my own house (4/2) in the same town. Probably not what you want to hear but, it might not be direct competition.
Don’t hold all your eggs in one basket - Posted by Jim FL
Posted by Jim FL on November 10, 2002 at 22:48:17:
Ron,
Okay, you are running ads in three publications, for two weeks.
The response has been slow at best.
There are two possible reasons why your calls are slow.
The terms are not good.
The ads are not reaching anyone.
I’d first check my numbers and make sure I was actually offering something attractive.
Are you looking for too much money monthly?
Hopefully you are not even mentioning the amount down you want in the ads?
What does your ad say anyway?
This might be an area we can help with here.
In addition to checking terms and making sure you are offering good ones, in a way that is appealing to many.
You need to market those terms to as many people as you can.
A few things to add to your marketing, if you are not doing this already.
A sign in the yard, and perhaps some flyers in a tube and/or taped to the front of the house explaining the terms and giving the house details.
Directional signs pointing to the house.
Signs and flyers around town advertising the house.
Highlight the good things about your offer, ie: RENT TO OWN, Problem Credit Okay, Low $$ Down,Nice 3 bed/2 bath, $xxx/month etc.
Perhaps fax the info to some local mortgage brokers, or drop by their offices and pass the info along.
They often get clients who cannot get a loan now, but might be able to if they were already in a house. If they send you a buyer like that, you can send that buyer back to them later to get a loan.
Win/win
Also, goto places renters go for services, dry cleaners, family eateries, laundymats, food stores, wherever, and distribute your message.
Let people know about the house and your good terms to get into it, and the place will fill before you know it.
Good luck and come back here with more if you need to.
There are certainly a number of people here willing and able to help.
You may be asking to much. I know my first L/O deal I had a ton of calls! Once I told them price, monthly payment, and option consideration they quickly lost interest. Remember you cant have all 3 you must give a little too. You may have to give with what ever you are asking as a option consideration thats what was killing me. You should try and set it at between 3-5% of asking price. Make sure your monthly payment are reasonable too. Give generous rent credit, You can ask a higher asking price, if you can give the terms somone wants they wont look at your asking price to hard. That is my experience give it a try.
1511 N Walnut. Presently listed with an agent at the same time as I am marketing it by owner. I haven’t terminated the listing because I will just as happily take a buyer as I will take a T/B.
Keep in touch. I own spokanebyowner.com and would be happy to help you with any marketing you are planning on doing.
Re: Don’t hold all your eggs in one basket - Posted by Mark (SDCA)
Posted by Mark (SDCA) on November 12, 2002 at 11:49:07:
I will bet its neither 1 nor 2. I have seen exactly this same thing in my market AND I have seen multiple posts about it in different areas of the country.
There just seems to be a shortage of renters in general right now. The hypothesis is that all the “good renters” are now owners due to the low interest rates.
That is a great post! I am going to print it out and hang it on my wall.
To answer your questions about what I have been doing so far:
I have paid to have the house appraised by a certified appraiser. Value came in between $80K & $83K.
When I have been asked by prospects how much the price of the house is. I have told them the “final price” depends on how much down they put and which of “our down payment assistance programs” they choose.
I have only advertised the monthly rent in the ads. Since market rent for a 4 bedroom home in the area is $800, and I have a practically brand new home (much nicer that anything within a mile), I have been asking $850 in my ad.
The ad reads:
RENT to Own! Like new 4 bd, 1 3/4
bth Home, 30% Rent Credit, Close to
schools, $850/mo. Toll Free
877-589-5746 24 hr. rec. mssge.
Feel free to call the message to see if you think it’s o.k.
I haven’t put a sign in the yard, because it currently is listed with a real estate agent. I haven’t terminated the agent yet, hoping he might actually find a buyer for the property before I find a tenant/buyer.
I love your idea about contacting some mortgage brokers to help advertise the property. As it turns out, I know quite a few mortgage people.
I also like your idea of going where renters go for services.
If you have any ideas to improve on what I have already done, I am willing to try almost anything.
Thanks for your input. I have had the home appraised by a certified appraiser at between $80k and $83K, I have been asking $89,500.
I know that market rent for a 4 bdrm in our area is around $800. However, the home I have is practically brand new with all new carpets, wiring, furnace, roof, and much more. So I have been asking $850.
I have been advertising a rent credit of up to 30% and looking for $3K to 5K down. This is slightly higher than the 3% to 5% that you mentioned but I figured if things got nasty with the tenant later, I could handle potential damage and eviction costs from the option consideration.
Perhaps I should just say $250 rent credit instead of up to 30%? My plan was to give the rent credit only if they paid more than the $850 each month and only if they paid on time.
I wish I were getting a ton of calls. At least I would know if my offering were out of line or not. At this point it doesn’t appear that I have generated enough interest to make a fair determination.
I am just giving another perspective to this situation. While you have done an appraisal, have you done a FMV evaluation (CMA) of the property? It is not uncommon for a property to appraise at $80k and have an FMV of $72k. I am trying to give you another look that when you tell a buyer that the property is $89,500, but when they look at it, it is just like the other properties they looked at for $72k. That can look like a big jump, or small, depending on the buyers. Of course, this is retail speaking and you are not trying for retail to sell it outright, you are searching for a T/B which is why you have the property priced above the appraisal, and possibly above the FMV of the property at today’s value.
Posted by Tim (CT) on November 11, 2002 at 10:53:01:
Why don’t you call the people back and ask them why they are now disinterested? Tell them there isn’t any pressure but that you just want to find the reason they’ve gone a different direction. It’s difficult to ask questions on this board about buying habits of people in your market place. Go right to the source of the “breakdown” in marketing. They should be able to tell you why. And, if you get a consistent answer (i.e. maybe your asking price is too high), then at least you know and you can make decisions from there.
I’ve had some great answers from people on this board but I would rather go by answers from 5 people in your marketplace that were interested at one time than from 10 people on the board who aren’t in the minds of your buyers.
If I become more motivated to move this deal, would you suggest that I lower the price down to the appraised value and then show the appraisal to the prospective T/B?